by Jonathan A. Nelson
We live in a mobile society, and people change their state of residence for many reasons, including work, cost of living, family, and retirement. When moving to a new state, do you need to do anything with your estate plan?
First, the good news: between the Full Faith and Credit clause of the U.S. Constitution and state statutes on the topic, as long as they were valid in your old state, the old will and most other documents will be recognized by the new state and given effect.
With that said, there are still aspects of the documents that are state-specific. Some are purely procedural – a Texas will might include a direction that probate be an Independent Administration, but Virginia doesn’t have that process, so the instruction simply won’t have any effect. Others are just questions of efficiency – for instance, a Maryland will may include a testamentary special needs trust with no ill effect in Maryland; if that will is probated in Virginia, the special needs trust will still work but could cost ten thousand dollars per year in administrative expenses which could have been avoided by having the special needs trust in its own standalone document.
Some things can be more substantive. As one example, Virginia permits gifts of tangible personal property in a list that isn’t executed with the same formalities as a will; however, that list isn’t itself a will, so a state other than Virginia may not recognize that list as binding. Puerto Rico allows a successor guardian for an incapacitated adult to be nominated in a will, but in Virginia you would instead need a pre-death court order naming a standby guardian. A gift under the Uniform Transfer to Minors Act may transfer to the child at a different age in the new state (although thanks to South Carolina’s passage of this Act three years ago, all U.S. states have at least some version of it). Creditor claims can also be handled differently in the new state, and different provisions may be needed to keep sentimental assets from falling into creditors’ hands.
Another area that could cause difficulty are rights that supersede the estate plan documents. A surviving spouse, for example, may have the right to make claims in the new state that disrupt what was previously a carefully balanced estate plan. Or the new state might not extend the same rights to a nonmarital partner. (As a practical matter, regardless of home state law I would tend to be overdescriptive in provisions involving a nonmarital partner: even traveling through a state that does not recognize the relationship may cause problems if, for example, a medical decision needed to be made after a car crash.)
Trusts can have significant value after interstate moves. They retain much (but not all, particularly as to spousal rights) of the law of the old state, providing continuity and predictability.
When moving between states, I recommend consulting a lawyer in the new state. He or she may advise that you do not need any changes to your documents, or may want to talk to your old estate planning attorney about differences, but either way can help fix potentially disruptive surprises before it is too late.
It is also helpful to speak with your estate planning attorney about your documents and how you hold title if you own real estate in a different state from your residence: many of the same issues arise since that real estate would pass in an ancillary probate under that second state’s laws.
Virginia attorney Jonathan A. Nelson uses his extensive legal knowledge and trial experience to resolve conflicts, negotiate settlements, navigate compliance matters, and vigorously advocate in the courtroom in order to achieve the best possible outcomes for his clients. He practices in estate planning, probate, trust and estate administration, corporate law, and civil litigation related to these fields.
The attorneys of Smith Pugh & Nelson, PLC, offer the experienced counsel, personal attention, and customized legal services needed to address the many complex issues surrounding estate planning, probate, and trust administration. Contact us at (703) 777-6084 to schedule a consultation.