Wills and Estates

 

What is a Will?

A will is a written set of legally enforceable orders directing the transfer of property to named beneficiaries effective upon the death of the maker.

What is required to make a valid Will?

  • The person must be at least 18 years of age and of sound mind and memory;
  • The Will must be in writing and signed by the maker or signed by a person subscribing to maker's name in his or her presence and at the maker's direction;
  • The Will must be witnessed by two or more credible witnesses, who subscribe their names in the presence of the maker. In Delaware, a beneficiary to the Will may be a witness although in some states this is not allowed.

A Will written entirely in the Testator's handwriting (a Holographic Will) is only valid in Delaware if the above requirements are met.

Self-Proved Wills

A Will can be entered for probate without the necessity of the witnesses to the Will appearing in the Register of Wills Office to verify the signature of the maker if it is a "Self-proved" Will.

This is accomplished by having the maker and witnesses to the Will sign an affidavit containing the required statutory language before a Notary Public.

Legality of Out-Of-State Wills

Many States have different requirements for making a valid Will. Delaware recognizes the validity of a Will signed:

  • In a different state if executed in compliance with Delaware law; or,
  • If its execution complies with the law in the state where execute; or,
  • Of the law where at the time of execution or at the time of death, the maker is a legal resident.

Filing the Will

After the maker dies, it is the legal duty of any person in possession of any original document that might be a Will to deliver it to the Register of Wills Office within ten (10) days after receiving notice of the death of the maker.

What happens if you die without a Will?

If you die without a Will, or your will is rejected, your estate is considered an "Intestate" estate. Any part of an estate located in Delaware not effectively disposed of by Will, passes to the decedent's heirs as follows:

  • Share of Spouse
    • If there are no surviving issue or parents(s) of the decedent, the entire intestate estate goes to the spouse;
    • If there are no surviving issue but the decedent is survived by a parent(s), the first $50,000 of the intestate personal estate, plus one-half of the balance of the intestate personal estate, plus a life estate in the intestate real estate goes to the spouse;
    • If there are surviving issue, all of whom are issue of the surviving spouse also, the first $50,000 of the intestate personal estate, plus one-half of the balance of the intestate personal estate, plus a life estate in the intestate real estate goes to the spouse.
    • If there are surviving issue, one or more of whom are not issue of the surviving spouse, one-half of the intestate personal estate, plus a life estate in the intestate real estate goes to the spouse.
  • Share of Heirs other than surviving spouse: The part not passing to the spouse as above, or the entire intestate estate if no surviving spouse, passes:
    • To the issue of the decedent, per stirpes, (see glossary);
    • If there are no surviving issue, to the decedent's parent or parents equally;
    • If there are no surviving issue or parent(s), to the brothers and sisters and issue of each deceased brother or sister, per stirpes.
    • If there are no surviving issue, parent, or issue of a parent, then to the next of kin of the decedent, and to the issue of a deceased next of kin, per stirpes.

Any heirs must survive the decedent by 120 hours to inherit in accordance with the above schedule.

Jointly held property

Many people hold real estate, bank accounts, motor vehicles, and other property (stocks, bonds, etc.) in joint names with a right of survivorship.

Upon the death of the first joint tenant, the surviving joint tenant (co-owner) receives the property regardless of any contrary language in any Will and without the application of the intestate law if no Will exists.

Life insurance that is not payable to the estate of the decedent passes according to the contract between the insurance company and the decedent, that is, to the named beneficiary.

Should I have a Will?

It is not always necessary to have a Will, but if you wish to transfer your property to beneficiaries who might not otherwise receive the amounts you desire or any property at all according to the intestate laws, then you should consider drafting a Will.

It is also helpful to protect your minor children by use of a Will to name possible guardians of their person and property.

Another major goal of estate planning by Will and/or trust is to avoid the effect of taxes.

By having most or all of your property held in a joint tenancy with right of survivorship, you can effectively plan for distribution of your estate without using a Will. However, should there be a catastrophic accident which results in simultaneous death, your estate may still be disposed of by the intestate laws.

How should I prepare to make my Will?

Whenever possible, a lawyer should draft your Will to avoid legal problems during execution. It will save time and money by doing these simple steps before you meet with the lawyer.

When you decide to draw a Will, you should also do some advance planning. Prepare a listing of your property, your money, and your real estate holdings. Locate your insurance policies. Make a list of the people to whom you wish to leave this property. Choose an executor who is willing to execute your expressed intentions.

Extrinsic letter or memorandum

If you have personal belongings but are not sure to whom they should go when you draft your will, you can allocate them in an "extrinsic letter" or "memorandum". This saves the expense of having your Will redrawn each time you change your mind about non-major pieces of personal property.

This document cannot include transfers of:

  • Money;
  • Mortgages;
  • Notes
  • Bonds;
  • Certificates of Title;
  • Securities; or
  • Property used in trade or business.

Please note that the Will itself must refer to the existence of an extrinsic letter before that letter can have any effect.

How do I change my Will after original execution?

An entire Will can only be revoked by:

  • Destroying the document(cancellation); or,
  • Executing a new Will after the previous Will; or,
  • By written direction signed by the maker and witnessed by at least two witnesses.

You may change parts of an existing Will by executing a "Codicil" (see glossary). Whenever you make a Codicil to a Will, the Codicil must be executed with the same formalities and referenced to the date of the original Will.

Certain events modify the effect of a Will without a person having to make any actual change to the document. If a person is married, makes a Will naming a spouse a beneficiary or Executor, and subsequently divorces that spouse, the clauses covering the spouse are to be read as though the spouse had pre-deceased the maker.

If the maker fails to mention a child who is born after the Will is executed and that child is not provided for in any way under the Will, that child may make a claim against the decedent's estate as though the decedent died without a Will.

Letter of last instruction

Many people prepare a Will and then put it in a location unknown to the Executor and/or heirs. In order to avoid unnecessary confusion at the time of your death, it is our suggestion that you prepare a letter of last instruction to be kept in an easily accessible place to allow your heirs or Executor(s) to locate this important document upon your death.

This letter might explain:

  • Where your Will can be found;
  • The names and addresses of those persons you wish notified of your death;
  • Your instructions for your funeral and burial arrangements;
  • Where to find documents of title, stocks, bonds, insurance policies, etc.;
  • Directions concerning anatomical gifts;
  • Where your safe deposit box and key can be found.

What is a Trust?

A trust is a written document which controls the disposition of certain property which you have designated.

It requires that title to the property remain in a trust for a limited or extended period of time before the eventual owners of that property may dispose of it according to their own wishes.

There are two general types of trust:

  • An "inter vivos trust" goes into effect during the life of the maker.
  • A "testamentary trust" does not go into effect until the death of the maker. This trust can be contained in a Will or in a separate document that does not go into effect until the Will of the maker is probated.
  • Revocable trust may be amended before or after the making of the Will.

Gifts

Federal and Delaware law do not tax gifts where the gift is $10,000 or less per person in any one taxable year. Gifts of larger amounts will be taken into account when estate and inheritance taxes are eventually calculated.

There is also a new unlimited marital gift tax deduction that is allowed under Federal and Delaware law. This allows one spouse to make gifts to the other of unlimited amounts each year without incurring any gift tax.