You did the responsible, prudent thing to do: you consulted with an estate planning attorney and did an estate plan. You have a health care power of attorney, a financial power of attorney, a pourover will, and a revocable living trust. You even funded your assets into the trust so that they would avoid probate. But, now you are moving across country and are wondering how this move impacts on your estate plan.
The documents you signed prior to moving to another state are usually still valid. States typically honor documents that were valid and enforceable in the state in which they were prepared. So, for example, even though Florida requires a revocable living trust to be witnessed and notarized, it will honor a trust signed while you lived in Illinois where no witnesses were required.
Powers of attorney for health care and financial matters also are usually still valid. However, though technically valid, the powers may be unfamiliar to those in your new state. A power of attorney is only as good as people’s willingness to accept it. You do not want to have to take a bank or hospital to court when you go to use it. So, it usually is best to do new powers of attorney.
Trusts created in one state are typically valid in another state. However, the provisions of the trust may need to be changed in order to take advantage of or plan around differences in the laws. For example, one state may have no separate estate tax while another state may. Planning to minimize taxes may require changes to the trust.
You can change the trust by signing an amendment or restatement of the trust with the proper formalities for the new state. An amendment changes specified provisions while a restatement basically removes everything but a shell and replaces it with new provisions. Either way, the work you did in funding the trust will not need to be repeated. Even though the terms of the trust may change, the title to the assets in the trust would not need to change.
In addition to your existing estate planning documents, new documents may be required. For example, if you move into a community property state, you and your spouse may want to convert your separate property into community property. This would be accomplished by a property agreement.
After moving, it is very important to consult with a qualified estate planning attorney in your new state. There may be laws with which you are not familiar, such as community property in California, the intangibles tax in Florida, or the stand-alone estate tax in Ohio. Your estate planning attorney can explain the important legal differences and can tell you which documents should be changed.
Compliments of the McGee Law Firm, Attorney Brandon McGee
Written By: The American Academy of Estate Planning Attorneys
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