People's inheritance rights vary depending on the estate planning tools used by the decedent, or the person who died. Some estate planning techniques require inheritances to pass through probate courts. Estate planning can also be crafted to avoid probate court. Moreover, some people do not make any estate plans at all. In these situations, state law identifies a decedent's heirs and outlines their inheritance rights.
When a decedent leaves a will, his estate is called testate. Heirs named in wills have a right to receive their inheritances as soon as reasonably possible. Generally, state law requires a will's executor to transfer estate assets to heirs after all estate debts are paid. An executor must publish notice of the probate proceedings in a local newspaper so creditors have a chance to submit claims for payment. An heir has the right to petition a probate judge for inheritance distribution if the executor fails to convey the estate's assets according to the will's directions.
When an individual dies without a will, his estate is called intestate. State statutes name a decedent's family members as heirs. Generally, spouses are prioritized to receive intestate estates, followed by children. If no spouse or children exist, statutes default to the next living relatives. If the decedent is not survived by kin, the intestate estate transfers to the state treasury. Like testate heirs, intestate heirs may petition a probate judge if an executor fails to distribute their inheritance according to state law.
Estate planning techniques that avoid probate are called will substitutes. Revocable living trusts are popular will substitutes. A trustee must convey assets to a decedent's named beneficiaries according to the trust's terms. If a trustee fails to do so, the named beneficiaries may bring a lawsuit to enforce the trust's directions. They may also ask the court to replace the trustee. State law governs trusts.
Jointly Held Assets
Trusts are not the only estate planning tools used to bypass probate. Jointly held assets allow a joint tenant full rights to property upon the death of his joint tenant. Real estate, bank, brokerage and retirement accounts are regularly held jointly with survivorship rights. Generally, presenting a decedent's death certificate legally entitles a surviving joint owner full ownership of assets.
Payable on Death Accounts
Individuals may also maintain sole accounts with a named beneficiary. These are called payable on death or POD accounts. POD accounts are also referred to as Totten trust accounts. A Totten beneficiary generally has the right to obtain assets upon presentment of the account holder's death certificate.
- Jupiterimages/Comstock/Getty Images