Each state has its own regulations regarding a Last Will and Testament, trusts, and power of attorney, which can significantly impact the distribution of your assets and the execution of your wishes. Failing to update an estate plan after a move could lead to unintended consequences and legal complications for you and your loved ones. For further information on what can happen to your estate plan when moving to a new state, contact Roulet Law Firm, P.A. by reaching out to our law offices in Minnesota at 763-420-5087 and Florida at 941-909-4644.
Importance of Updating Your Estate Plan
When moving to a new state, updating an estate plan can help ensure that assets and last wishes are legally protected. Failing to modify this plan can lead to numerous complications and potential legal issues for beneficiaries and loved ones.
Legal Differences Between States
Each state has distinct laws governing Wills, trusts, and powers of attorney. When a person relocates to a new state, it is crucial for them to understand these state-specific laws. This understanding will help them make necessary updates to their estate plan, ensuring that it complies with the regulations of the new state and avoids any discrepancies that could potentially invalidate certain provisions.
Impact on Estate Taxes
The Tax Foundation indicates that in addition to the federal estate tax, some states also have their own estate or inheritance tax. Therefore, it is important to review and update an estate plan after moving to a new state to account for these changes in tax laws. Failing to update an estate plan accordingly could lead to unexpected tax burdens for an individual's heirs. However, by reviewing these tax laws and adjusting the estate plan as needed, individuals can ensure a smoother transfer of wealth.
Impact on Establishing Residency
Many clients we work with are moving from states that have an income and/or estate tax - like Minnesota - to Florida, which does not have an income or an estate tax. Since your old state of residence may still want to treat you as a resident for tax purposes, updating your estate planning documents to the laws of your new state can be a factor in establishing residency there.
Key Elements To Review in Your Estate Planning
Although it is important to review all of your estate planning documents when moving to a new state, some of the key elements to review include the following:
Wills and Trusts
When you move to a new state, you will need to review your Will and trust to ensure that they comply with the specific regulations of your new location. State and federal laws vary significantly regarding estates and can have an impact on your estate planning. For example, laws related to marital situations, family businesses, tax cuts, and transfer-on-death laws need to be carefully examined to determine what updates are necessary.
Florida Homestead and Your Trust
Florida’s homestead laws provide significant protection for your home. Examples include capping the rate of property tax increases and significant limits on creditor’s claims. However, it is important that your trust contain specific language in order to maintain homestead status on your home when you transfer it to your trust. This is a specific requirement in Florida and is a trap for many people who move here with trusts created in other states that usually do not include the required provisions. Failure to include the proper provisions could result in the loss of homestead status. This is just one example of how important it is to update your estate planning documents when you move.
Power of Attorney and Healthcare Directives
According to the American Bar Association, a power of attorney is accepted in all states, but the requirements and regulations for this document will vary from state to state. A power of attorney and healthcare directives are legal documents that allow another individual to make decisions on your behalf if you cannot do so. It is crucial to update these documents to comply with the laws of your new state and ensure that your wishes are respected and legally binding in the event of incapacity or medical emergencies.
Updating Your Estate Plan
Updating your estate plan as soon as you can after a move can help ensure your assets are protected, and your legal documents comply with the applicable laws. Below are some steps to consider taking to help with this update:
Consult an Experienced Local Estate Planning Attorney
Consulting with an experienced estate planning attorney with knowledge of the specific laws and regulations in the new state can provide you with tailored advice on how to adjust your estate plan. These legal professionals can review the critical documents you have, such as your Will, trust, power of attorney, and healthcare directives, and verify that these documents align with the legal requirements of your new state.
Revise and Propery Execute and Notarize Documents
Once you have reviewed the necessary changes with an estate planning lawyer, you can start updating your estate plan documents to comply with the laws of your new state. This may involve revising your Will, trust documents, power of attorney, and healthcare directives.
After making the revisions, it is crucial to properly execute and notarize these documents to give them legal validity.
For more information on updating your estate planning documents when moving to a new state, consider reaching out to an experienced Minnesota and Florida estate planning attorney at Roulet Law Firm, P.A.
Frequently Asked Questions
After a move, it is common to have many questions, especially about legal documents and future plans. Here are some prepared responses to commonly asked questions about estate plans after a move:
What Are Some Common Pitfalls To Avoid When Updating an Estate Plan After Moving To a New State?
Common pitfalls include overlooking minor state laws, missing state-specific forms, or failing to meet new state requirements. For instance, minor details can have significant implications for the distribution of assets and the execution of the estate plan. Moreover, failing to comply with these state-specific requirements can lead to delays, impacting when loved ones can get their inheritance or other assets. That is why it is critical to conduct thorough research or seek guidance to prevent these pitfalls.
How Can You Ensure You Have an Updated Estate Plan That Complies with the Laws of the New State?
To ensure compliance, conduct detailed research on the estate planning laws of the new state. In addition, consider reaching out to a local estate planning attorney who can assist you in aligning your legal documents with the state-specific regulations, including minor details and required forms. This proactive approach could help you with a smooth execution of your estate plan in accordance with the laws of the new state.
Contact Roulet Law Firm, P.A. To Learn More About Estate Planning When You Move
Updating your estate plan when moving to a new state is important. Doing so can help protect your assets and ensure your plan complies with state regulations, preventing future complications. If you need more information about estate planning when moving to a new state or want to update your estate plan in Florida or Minnesota, please contact Roulet Law Firm, P.A. today. You can reach us at the following locations: Minnesota 763-420-5087, Florida 941-909-4644, or you can fill out the contact form on this page and a member of our team will reach out to schedule a consultation.
Or, if you are not yet ready to schedule a consultation and would like additional information, we have some resources for you.
If you would like to learn more about wills and trusts and how you can make it as easy and inexpensive as possible for your family, Click Here to sign up for my online masterclass where I reveal insider strategies for your will, trust, financial power of attorney and health care documents, as well as how to minimize or even avoid estate taxes, and how to protect the money you leave for your children and grandchildren in the event they get divorced, get sued or something else happens to them.
If you would like to learn more about how to protect your home and savings from long-term care and nursing home costs. I have two resources for you:
