Families are not as well protected as they think. Many people have assumptions about what happens to property when a husband or wife dies, but many times they are wrong.
Everything does not automatically go to a spouse
In North Carolina, a “typical” family unit may mean a mother, father and two children. If the father passes on leaving no Will, his wife will receive the first $15,000 of personal property (all property not considered land or buildings attached to land), a third of the rest, and a third of all real property (land and buildings). Children receive their inheritance at age 18, regardless of how immature they may be, and can spend it all on an expensive sports car if they wish. The children can also force the family home to be sold, and the wife may end up moving into an apartment. All because the husband didn’t bother to write out a Will.
Your Burial Plans are Left to the Whims of Relatives
Whenever a person passes on without leaving specific burial instructions, their relatives decide how the service should be conducted, what type of burial is to be performed, and how much money will be spent on the funeral process. Grief-stricken families may be talked into needless services and “extras” by unscrupulous funeral home directors or, as is more often the case, their own desire to give “only the best” to their deceased loved one. A person who may have wanted a $1,500 cremation while wearing a t-shirt and jeans and a simple service may end up with a $18,000 burial in an expensive casket while wearing a tuxedo. All because they didn’t bother to write down their wishes beforehand.
Wishes For Custody of Minor Children are Unheard
Anyone who has a minor child could be setting them up for a childhood of hardship and sadness if they don’t properly select guardians and name them in a Will. If something does happen to you and your spouse, do you know who will take care of your children? A court will end up making the final decision, but an unfit brother that would be the last person you want to raise your children may be favored over the life-long friends you trust implicitly. A court will not consider what you may have wanted had you bothered to write it down, but it will instead use its own judgment, morals and preferences to arrive at its own conclusion.
If you care for your children and are at all concerned about who would raise them if you weren’t there, then you must have it in a Will. You will have no say unless you write your wishes down. Your children are worth the time and money it will take for you to write your wishes down in a legally executed Last Will and Testament.
Your Children May Be Left With a Huge Tax Bill
Upon the death of an individual, the federal government imposes a tax; however, for most individuals, the impact of the tax is minor because every person has lifetime estate tax exemptions. In short, if you own less than $675,000, then federal estate taxes do not apply to you. In addition, the lifetime exemptions for each individual are increasing over the next several years until the year 2009 when it reaches $3,500,000. The federal estate tax exemptions will increase as follows:
Year Exemption
2009 $3,500,000
2010 Unlimited
2011 $1,000,000*
* Exemption amounts are reduced to $1 million in 2011 unless Congress reauthorizes the RELIEF Act of 2001.
Keep in mind that these exemptions are not cumulative. So if a husband died in 1999 with $650,000 going to his wife, and the wife dies later in 1999 with $650,000 of her own plus the inheritance from her husband, she had an estate of $1,300,000. Her children would have received $1,300,000 from their mother, but only $650,000 was exempt property. The federal estate tax would have amounted to $258,500, leaving the children with $1,041,500. With proper estate planning, there would have been no federal estate taxes in this example.
There are many reasons to create a Will or Revocable Living Trust, and the few pages of this website are not sufficient to go through all of them. The bottom line is that your family is worth the time and investment it takes to create an estate plan. For more information, or to set up a free consultation, please Contact Us or call (919) 844-7993.
Families are not as well protected as they think. Many people have assumptions about what happens to property when a husband or wife dies, but many times they are wrong.
Everything does not automatically go to a spouse
In North Carolina, a “typical” family unit may mean a mother, father and two children. If the father passes on leaving no Will, his wife will receive the first $15,000 of personal property (all property not considered land or buildings attached to land), a third of the rest, and a third of all real property (land and buildings). Children receive their inheritance at age 18, regardless of how immature they may be, and can spend it all on an expensive sports car if they wish. The children can also force the family home to be sold, and the wife may end up moving into an apartment. All because the husband didn’t bother to write out a Will.
Your Burial Plans are Left to the Whims of Relatives
Whenever a person passes on without leaving specific burial instructions, their relatives decide how the service should be conducted, what type of burial is to be performed, and how much money will be spent on the funeral process. Grief-stricken families may be talked into needless services and “extras” by unscrupulous funeral home directors or, as is more often the case, their own desire to give “only the best” to their deceased loved one. A person who may have wanted a $1,000 cremation while wearing their softball league uniform and a simple service may end up with a $15,000 burial in an expensive casket while wearing a tuxedo. All because they didn’t bother to write down their wishes beforehand.
Wishes For Custody of Minor Children are Unheard
Everyone who has a minor child could be setting them up for a childhood of grief and hard times if they don’t carefully select guardians and name them in a Will. If something does happen to you and your spouse, do you know who will take care of your children? A court will end up making the final decision, but an unfit brother that would be the last person you want to raise your children may be favored over the life-long friends you trust implicitly. A court will not consider what you may have wanted had you bothered to write it down, but it will instead use its own judgment, morals and preferences to arrive at its own conclusion.
If you care for your children and are at all concerned about who would raise them if you weren’t there, then you must have it in a Will. You will have no say unless you write your wishes down. Your children are worth the time and money it will take for you to write your wishes down in a legally executed Last Will and Testament.
Your Children May Be Left With a Huge Tax Bill
The federal government imposes an estate tax upon the death of every person. For most people, the impact of the tax is negligible because every person also has lifetime estate tax exemptions. In short, if you own less than $675,000, then you need not worry about federal estate taxes. In addition, the lifetime exemptions for each individual are increasing over the next several years until the year 2006 when it reaches $1,000,000. The federal estate tax exemptions will rise as follows:
Year Exemption
 |
2006 $2,000,000 |
|
2009 $3,500,000 |
|
2010 Unlimited |
|
2011 $1,000,000* |
* Exemption amounts are reduced to $1 million in 2011 unless Congress reauthorizes the RELIEF Act of 2001.
Keep in mind that these exemptions are not cumulative. So if a husband died in 1999 with $650,000 going to his wife, and the wife dies later in 1999 with $650,000 of her own plus the inheritance from her husband, she had an estate of $1,300,000. Her children would have received $1,300,000 from their mother, but only $650,000 was exempt property. The federal estate tax would have amounted to $258,500, leaving the children with $1,041,500. With proper estate planning, there would have been no federal estate taxes in this example.
There are many reasons to create a Will or Revocable Living Trust, and the few pages of this website are not sufficient to go through all of them. The bottom line is that your family is worth the time and investment it takes to create an estate plan. For more information, see Contacting Us or go to the Downloads page.