Who Inherits My Assets?

Have you ever asked yourself this question:

If I die without a will, who will inherit my assets?

Well, it depends.

A will only controls the distribution of probate assets. But what are your probate assets?

Probate Assets

The following types of assets are often non-probate assets:

  • Real estate titled in joint tenancy with right of survivorship;
  • Real estate titled as community property with right of survivorship;
  • Life insurance;
  • Bank accounts titled in joint tenancy with right of survivorship;
  • Bank accounts titled as community property with right of survivorship;
  • Individual Retirement Accounts ("IRA"); and
  • Other retirement accounts governed by ERISA.

Non-Probate Assets

The following types of assets are often non-probate assets:

  • Real estate titled in joint tenancy with right of survivorship;
  • Real estate titled as community property with right of survivorship;
  • Life insurance;
  • Bank accounts titled in joint tenancy with right of survivorship;
  • Bank accounts titled as community property with right of survivorship;
  • Individual Retirement Accounts ("IRA"); and
  • Other retirement accounts governed by ERISA.

Typically, non-probate assets are distributed pursuant to beneficiaries who are named in the documents and/or plans associated with the non-probate assets. 

So, Who Gets My Probate Assets?

In Arizona, if you don't have a will, the distribution of your probate assets is governed by Arizona's "Intestacy Statutes." A.R.S. § 14-2101, et seq.

If you've only been married once and that spouse is the biological parent of all your children, then your probate assets go to that spouse, if s/he is living. If, however, your spouse it not living, then your assets are distributed equally to your living children. If, however, one or more of your children is no longer living and that child also had children, then the deceased child's children share equally in that child's share of the probate estate

But here's were things start to get complicated.

While many people fit into the category above, many people don't.

If your current spouse is not also the biological parent of your children, then your current spouse is entitled to half of your separate property, while your children are entitled to the other half of your separate property and your half of the marital community property. Moreover, the same provisions regarding your children that predecease you, as mentioned above, also apply.

If, however, you do not leave a surviving spouse, then all of your living biological or adopted children are entitled to an equal share of your probate assets — the aforementioned provisions regarding children who predecease you, also apply.

If you aren't legally married at the time of your death and don't have any children, then your parents are your heirs, if they are living. If you parent's are not living, then your parents' descendants are your heirs. If your parents are not living and they had no other descendants, besides you, then your probate estate is split between the descendants of your paternal and maternal grandparents.

What About Step-Children?

Notice a group of people not listed in the provisions above?

Step-children.

This comes as a big shock to many, but unless you legally adopt your step-children, they are not entiled to a share of your probate assets, if you die without a will. That said, you can change this presumption by adding your step-children to your will.

This brief overview of some important considerations associated with estate planning is by no means comprehensive. Always seek the advice of a competent professional when making important financial and legal decisions.

Arizona Estate Planning AttorneySteve Cook is an estate planning lawyer at Cook & Cook. Although his main office is located in Mesa, Arizona, he represents clients throughout the Phoenix, Arizona Metropolitan area including the following east valley cities: Scottsdale, Paradise Valley, Tempe, Chandler, & Gilbert.

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