As the year winds down, but the flurry of holiday preparations hasn’t quite hit home, now is a great time to review your estate planning to ensure it's current and correct. Remember one key point that your will and trust don't typically direct the distribution of assets that already have designated beneficiaries. This includes IRA accounts, 401(k), annuities, life insurance, pay on death accounts, transfer on death deeds, and property titled as "joint tenancy with right of survivorship".
In our practice, we recently experienced a case where an individual named both children as equal beneficiaries of an IRA, but subsequently left everything under a will to only one child. The will did not control the IRA distribution (correctly, under the law), but is that what the decedent really intended? If a child was excluded under one document, wouldn't the decedent want it to be consistent? Or perhaps it was intentional. The beneficiary spent more money than otherwise necessary on the probate and administration to clarify the decedent's intent. We have seen this more than once. However, if the plan had been up to date and indicated that the intent was to treat those assets differently (not that the will controlled everything), the family would have been able to approach the death as an opportunity to connect, not to continue past conflict.
So when you take your documents to your estate planning attorney to discuss any current changes in your life (divorce, disease, deaths, etc.), be sure to also have her review the beneficiary designations you've made. Sometimes the designations are made on the fly without realizing how the whole plan will come together as a whole or your intent changes regarding how assets should be distributed. Sometimes that is exactly what you want, but still need to make sure it's clear to those you leave behind. If you have made designations different than the distribution of assets under your will or trust, you may want to include an acknowledgement of that fact in your will or trust using a trust amendment or codicil to your will. However, the language used can create its own problems if not done correctly, so be sure to receive professional advice on the issue.
For assistance with Washington state estate planning, probate and trust administration, call Megan Lewis Law, PLLC at (509) 557-7797 or complete our contact form. Our office provides local service for Spokane estate planning and can provide online virtual web and phone conferencing for estate planning in Seattle, Olympia, Bellingham and other areas of Washington state.
Megan M. Lewis