What Happens to My Things If I Don't Have a Last Will (or a Trust)?
- Where a person’s things go depends on 1) what assets are in their “estate” when they pass away, and 2) which of their family members are still living when they pass away.
- Generally, a person’s spouse will inherit some or all of their estate, then a person’s children (and/or grandchildren, great-grandchildren, etc.) are next in line to inherit, then the person’s parent(s), then the person’s sibling(s), and finally the person’s more remote relatives like aunts, uncles, nephews, nieces, etc.
Figuring It Out Step-By-Step
If a person passes away without a Last Will, then New Hampshire law RSA § 561:1 specifies who their things will go to. This law is titled Distribution Upon Intestacy because “intestacy” is a legal term that just means a person doesn’t have a Last Will.
At first glance this law may seem complex, but that’s just because of the legal language and because it must cover a lot of different scenarios.
A. What’s in a Person’s Estate
The first paragraph of RSA § 561:1 basically states that the law applies to assets in a person’s “estate.” Generally, an item is in a person’s estate when they pass away if it is 1) titled solely in their name as an individual and 2) they have not designated a beneficiary for this item elsewhere.
1. Property Titled in One Person’s Name as an Individual
Obviously, jointly owned property isn’t solely titled in the name of one person. Therefore, if property is jointly owned and one of the joint owners passes away, the property is not in that deceased person’s estate.
Here’s some common examples of jointly owned property:
- Joint bank or credit union accounts.
- A house that has multiple people listed as owners on the deed.
- A car that has multiple people listed as owners on the title.
Something to keep in mind is that if an item of property is jointly owned by two people and one of the owners passes, the property is no longer jointly owned. This is true even if the name of the person who passed is still listed on the account, deed, or title because a deceased person cannot own property.
Property that is titled in the name of a Trust or in the name of a person “as Trustee” of a Trust isn’t titled in that person’s name as an individual. For instance, if the owner of an asset is listed as “John Smith,” then this asset is owned solely by John Smith as an individual. However, if the owner of an asset is listed as “John Smith, as Trustee of the John Smith Revocable Trust of 2023,” then it’s owned by John Smith in his capacity as Trustee, not as an individual. Since property that’s in a Trust isn’t included in a person’s estate, Trusts are commonly used for probate avoidance.
2. Property Without a Beneficiary Designated
If an asset has a beneficiary designated, or a payable on death or transfer on death designation, then it automatically gets transferred to the designated person and isn’t in the owner’s estate when they pass.
This makes sense because the purpose of RSA § 561:1 is to decide who gets an asset when the asset’s owner hasn’t already made this decision. The law prefers that a person decides for themselves who will get their assets and will respect their decisions, whether it’s made in a Last Will, Trust document, or other legally binding designation.
Here’s some common examples of assets with beneficiary designations:
- Life insurance.
- Retirement accounts.
- Bank accounts.
- Certain securities, like stocks.
B. Surviving Family Members
Once it’s determined what assets are in a person’s estate, the next step is to follow the applicable instructions in RSA § 561:1(I) or (II), to determine who gets how much of the assets. This determination depends on who the person’s living relatives are, and the total value of all the assets in the person’s estate. The only tricky part here is decoding what some of the legal terms mean.
1. Does the Deceased Person Have a Spouse Who is Still Living?
“Decendent” means the person who’s deceased and who we need to know where the assets in their estate should go. If the deceased person was married and their spouse is still living, then Section I applies. If the person was not married, or if their spouse died before them, then Section I can be ignored entirely.
2. Does the Deceased Person Have Any Children (or Grandchildren, Etc.) or Parent(s) Who Are Still Living?
The word “issue” means lineal descendants, which are children, grandchildren, great-grandchildren, etc. “Issue of the decedent” means biological or adopted children (grandchildren, etc.) of the deceased person. “Issue of the spouse” means biological or adopted children (grandchildren, etc.) of the deceased person’s spouse. “Issue of the decedent who are issue of the spouse” means that a child (grandchild, etc.) is the biological and/or adopted child of both the deceased person and their spouse.
Under the law, stepchildren who were not adopted by a person are not that person’s “issue.”
Thankfully, the term “parent” just means the normal word parent. Similarly, the terms paternal/maternal, grandparent, brother/sister, etc. don’t have any special legal meaning, so no decoding is necessary here.
There are some legal terms in the subparagraphs of Section II, like “take by representation,” that are outside the scope of this blog post because they need their own blog post in order to explain them properly and completely. If you need assistance with understanding what these terms mean now, then please make an appointment to speak with Attorney Veronica DeSantis who would be happy to help.
Once the legal terms are decoded, then the next step is to figure out which Section(s) and subparagraph(s) apply. Only one subparagraph under each applicable section will apply.
Example: The Estate of John Smith
John Smith is married to Jane Smith, and they have one biological child together, Arron. Jane Smith also has a child from a prior marriage, Brian, but John Smith never legally adopted Brian. John Smith passes away and doesn’t have a Last Will, but he has $1 million dollars’ worth of assets. Jane, Aaron, and Brian are all still living when John passes.
The “decedent,” John Smith, was married and his spouse is still living, so Section I applies and cannot be skipped over. Aaron is “issue of the decedent” because he is John Smith’s biological child. Aaron is also “issue of the spouse” because he is Jane Smith’s biological child too. Brian is not “issue of the decedent” because he is not John Smith’s biological or adopted child. However, Brian is “issue of the spouse” because he is Jane Smith’s biological child.
Section I Paragraph (a) doesn’t apply because John Smith has surviving issue, who is his child Aaron. Paragraph (c) doesn’t apply for the same reason.
The first part of Paragraph (b) (“If there are surviving issue of the decedent all of whom are issue of the surviving spouse also”) applies because John Smith only had one child, Aaron, and Aaron is also Jane Smith’s child. However, the second part of Paragraph (b) (“and there are no other issue of the surviving spouse who survive the decedent”) doesn’t apply because Jane Smith has another child, Aaron, who is still living.
The first part of Paragraph (d) is exactly the same as the first part of Paragraph (b), so it applies for the same reason given above. The second part of Paragraph (d) (“and the surviving spouse has one or more surviving issue who are not the issue of the decedent”) also applies because Jane Smith’s biological son, Brian, isn’t the biological or adopted child of John Smith. Only one subparagraph under Section I will apply, so since Paragraph (d) applies there’s no need to look at Paragraph (e).
Paragraph (d) states that “the spouse shall receive…the first $150,000, plus 1/2 of the balance of the intestate estate.” John Smith has $1 million in his estate, so Jane Smith gets $150,000 plus one half of $850,000 ($1,000,000 – $150,000 = $850,000). One half of $850,000 is $425,000, so Jane receives $575,000 ($425,000 + $150,000 = $575,000) in total.
There’s still $420,000 in John Smith’s estate that needs to go to someone, so Section II comes in here. John Smith has surviving issue, who is his child Aaron, so Paragraph (a) applies and there’s no need to look at the other Paragraphs (each other Paragraph only applies “if there are no surviving issue”). Aaron is John Smith’s only child, so there’s no other issue for him to split assets with and he just receives all other assets in the John Smith’s estate, which is $420,000.
The content of this blog post is for informational purposes only and may not reflect current developments in the law. Do not make decisions based on the content of this blog post without consulting a lawyer first. Nothing in this blog post should be interpreted as guaranteeing any future result. Viewing this blog post does not create a lawyer-client relationship.