A frequent question presented to an estate planning attorney is the validity or continuing effect of documents executed under the laws of another state. Moving your legal residence to a different state should generally not cause your documents to be invalid, but existing documents may not be as effective under the laws of the new state and should be reviewed after a move. The overall goal with estate planning documents is to make sure the content of the documents is current and accurate and that all documents are in place for ease of future implementation. Some of the specific documents or changes include:
Probate Issues - Under Idaho law, the probate process is generally considered to be very straightforward and should not add significant additional cost or court involvement in the estate administration. For this reason, the testamentary plan is often carried out through a will. In other jurisdictions (such as California), the probate process is extremely cumbersome, time consuming, and often unnecessarily costly. In these states a revocable trust may be the better planning tool.
Character of Assets - Idaho is a community property state. If you have moved to Idaho from a non-community property state, it would be important to document your intent regarding character of marital assets, particularly if it is intended that separate property character be retained. The Idaho statutory presumptions may also be different from other community property states so it cannot be assumed that after a move the laws of the new state will characterize assets in the same manner. For example, in Idaho income from separate property is community property, while in other community property states income from separate property remains separate.
Powers of Attorney - There are two powers of attorney that are commonly utilized during the planning process - one for health care/medical decisions and one for property and financial affairs. Often the requirements and terms of these powers of attorney are outlined in the laws of the state. Although existing powers of attorney may remain valid after a move, it often makes it easier to deal with banks, title companies, and other person if the power of attorney is in a familiar and accepted format. If the powers of attorney are older, there may also be changes in the law that should be contemplated and included (such as the medical confidentiality requirements of HIPAA). The laws of some states may allow decisions that are not approved in Idaho (such as Oregon's Death with Dignity statutes) that are incorporated into the documents.
Title of Assets - Each state may have different ways to title joint assets or accomplish a distribution on death. Idaho allows real property to be held "community property with rights of survivorship" that may result in an automatic transfer of real property on death to a surviving spouse. A joint tenancy account in Idaho may not automatically be the asset of the surviving joint tenant without clear and convincing evidence of this transfer intent. When moving to a new state, the particular transfer and title options of that state should also be reviewed to help efficiently carry out the estate administration and avoid dispute.
This article is not intended to replace legal advice applicable to your situation and should be used only for informational purpose. Consult with your legal or tax advisors before implementing any suggestions contained herein.
Sandra L. Clapp