Alabama Intestate Estates: What happens when you die without a will?

Alabama Intestate Estates: What happens when you die without a will in Alabama?

Abraham Lincoln once said, “You cannot escape the responsibility of tomorrow by evading it today.” Many people love their families and loved ones but put off the responsibility of making sure they receive adequate care for when they leave this world. If you pass without a will or any estate planning documents your loved ones will become familiar with Alabama intestate estates and your county’s probate court. In such a situation, you died “intestate” and your relatives will divide your assets according to Alabama Code Title 43, Chapter 8, Article 3 called Intestate Succession. These laws can also apply during partial intestate estate, where you may have a will, but it does not transfer all of your assets or property.

When an Alabama intestate estate goes through probate, it costs more because an attorney must start with no documents to guide the estate distribution. There are no estate planning documents to make things nice and easy. Many times the loved one becomes the executor and must compile all your assets and debts. This is a monumental undertaking and frequently requires the help of an attorney. The proceedings are more involved, and the executor has to become bonded to protect the beneficiaries and creditors of your estate from their errors and mistakes. Let’s look at how an Alabama probate court will divide assets should you leave an estate in this messy situation.

Deceased Person Survived By A Spouse And Descendants

This can be a very confusing situation because you have many beneficiaries at varying levels of importance to the deceased person. A spouse is the most important person, and many just assume that he or she would inherit everything and move on. THIS IS INCORRECT! A deceased’s descendants will also inherit assets. The definition of a descendant is important because it can include their parents, children, grandchildren, and even great-grandchildren. This makes for a messy situation when one has not taken the time to settle their affairs and just assumes the spouse will get it all. This creates unintended consequences and is fertile ground for will contests in lawsuits.

Should a deceased person leave a spouse and descendants of any kind, the following rules will distribute the estate:

1. Should the decedent only leave a spouse, meaning no parents or children in his or her line, the spouse gets 100% of the estate.

2. If the decedent’s parents survive along with the spouse and no children, the surviving spouse will receive $100,000 and a half of the remaining balance of the estate. The parents will receive the rest of the estate.

3. Should a spouse and children of the decedent and spouse survive, the surviving spouse will inherit $50,000 and a half of the estate. The surviving children of the spouse and decedent will receive the other half.

4. Should the decedent leave living children, not from the surviving spouse, the spouse will receive one half, and the children will receive the other half of the estate.

These situations create all kinds of unintended negative consequences.

Deceased Person Not Survived By A Spouse

Should the decedent pass without a spouse, the beneficiary priority becomes even more complicated. It also brings in the possibility of the State of Alabama inheriting assets. Below is the order of priority:

1. Decedent’s children and their descendants;

2. Decedent’s parents;

3. Brothers and/or sisters, or if all deceased, the decedent’s nieces and nephews;

4. Grandparents, aunts, and uncles, or their decedents;

5. The State of Alabama

Now, this is where it gets complicated. These are all categories, and each descendant within the category inherits equally at that category level. For example, if the descendent passes with four children they would each receive one-fourth of the entire estate. Should one of those four children pass, their descendants would share in the deceased child’s one-fourth. Those in the categories below would not receive any assets.

When many individuals inherit property under the Alabama intestate laws, they assume title as tenants in common. Tenants in common is a title type that means that the beneficiaries don’t own one-sixth of the property, but one-sixth interest in the whole property. That means that a beneficiary can’t go pick out the nicest part of the property with trees and a pond to claim as their own.

The Disadvantages Of Alabama Intestate Estates

Intestate estates can create many issues for beneficiaries. The situations are not ideal and create expense and confusion among family members.

Below are a few disadvantages to an Alabama intestate estate:

1. You do not control your estate. By not having any estate documents you now allow the Alabama State Legislature and a judge to decide your estate distribution. Your spouse may have less than you intended, leaving them with fewer resources to carry on. Your children may receive an inheritance all at once, missing out on many tax advantages and protection from immature decisions. Also, you are not choosing a representative for the estate, your descendants will adding bonding expenses.

2. Settling the estate can take longer than normal. Typical estates can take 6 to 12 months to settle. With no documents, many issues to settle, and without documents, an Alabama probate court will apply the statutes and settle the estate. Since this is fertile ground for lawsuits, the estate could be at risk for years.

3. It costs more. Alabam intestate legal fees are higher due to the added time and complexity of the estate.

4. Your estate will be public. Since Alabama probate courts settle estates in court, the estate becomes a matter of public record. That means that your assets will be available for all to examine, and potential creditors and folks with improper motivations will analyze what the beneficiaries inherit.

These are less than ideal circumstances for those that are already dealing with the departure of a loved one. It creates added stress and emotion. Should you want to avoid these consequences by developing an estate plan, or trying to settle an intestate estate schedule a strategy session or call us at (205) 598-1810.

Joshua Key is the owner of Key Law, LLC and an estate planning and business attorney. He is a speaker, a blogger, a husband, a father, a pilot, and helps people create the life and business of their dreams.

At Key Law, we do more than just estate and business planning. Our goal is to help you live a full life and leave a legacy you can be proud of.

Growing your business and creating wealth for you and your loved ones as our main goal.

Here you can find information on estate planning, probate, business planning and formation, financial planning, productivity, finance, family protection, tax planning, and anything else Joshua thinks will help improve your quality of life.