BENEFICIARY LAWSUITS
Structuring your trust
A Wall Street Journal article recently profiled the growing trend of state legislatures passing what are known as “pre-mortem” laws, which allow residents to defend their wills – and in some states, their trusts — in court before they die.
States currently allowing “pre-mortem rulings” include Alaska, Arkansas, Delaware, Nevada, North Dakota and Ohio. The process starts when heirs – or the disinherited – are notified of the contents of a will or trust. If they fail to act within a set deadline – usually anywhere from 30 to 120 days following notification – they are barred from ever contesting the will or trust.
Domestic asset protection states like Alaska, Nevada and Delaware also allow those who set up trusts in their states to take advantage of the new laws. In addition, Alaska allows non-residents to use the pre-mortem process for their wills – but you have to appear in court in person.
Estate planning experts say that this new type of legislation could help families that might otherwise become embroiled in a costly battle over an estate. One downside is that, once you die, your will must go through probate and the probate court does not have to abide by a pre-mortem ruling in another state.
To get around that, the article notes, you could establish a revocable trust in Alaska, Nevada or Delaware, assign all your assets to that trust and hire a trustee who lives in that state. Any heirs would then have to abide by the outcome of a pre-mortem hearing.
|
|
