A Will determines what happens to your property at death. Even if all
of your known assets have been disposed of through trusts,
insurance policies and other non-probate instruments, a will is still
an essential document for appointing agents for administration,
identifying relatives to be skipped over or dispensing
bequests, inserting a no-contest clause, leaving funeral or burial
instructions, and directing previously unknown assets to
beneficiaries or trusts. One of the most crucial reasons for having a Will is to provide for the future of minor children. Parents with minor children or other dependent relatives should definitely have a Will to provide directions for the guardianship and care of minor children and others who cannot care for themselves. A properly executed Will can provide for domestic partners and loved friends, for a church or charity, or even for pets. In combination with a testamentary or intervivos/living Trust, a Will can provide additional security for those left behind. Without a properly executed Will, New Mexico state laws governing intestacy ( dying without a will) determine how a person’s property is distributed at death. The laws of intestacy are based on traditional ideas of fairness and provide a plan for a division of property between a surviving spouse, children and other relatives. New Mexico law also protects some of the value in a home or personal property for the spouse and family. However, the rules of intestacy do not fit many family and personal situations. A Will is a much more effective way to achieve your wishes. What happens without a Will?When a person dies without a will or with an invalid will, New Mexico laws of intestacy protect surviving spouses by passing the decedent’s separate property automatically to a surviving spouse if there are no children. If there are children, the surviving spouse takes 25% of the deceased spouse’s separate property and the children take 75%.The one-half of the community property which the decedent could have willed passes in intestacy to the surviving spouse. If there is no spouse and no children, then property is passed in intestacy to the first of the following groups of surviving relatives equally: to the decedent's parents, to the descendants of the decedent's grandparents or descendants of grandparents, and then to the decedent's other relatives (see Chapter 45, Article 2 NMSA 1978 for the full hierarchy). If there is no taker, the intestate estate passes to the state. What is the difference between Community and Separate Property?New Mexico is a community property state. In general, all property that is accumulated by either spouse in a marriage through earnings is considered community property. Community property is divided 50%-50% to each spouse. When one spouse dies, his or her one half of the community property may be disposed of by Will.Separate property includes property acquired before marriage, gifts and inheritances received by the person making the Will and damage awards received from lawsuits. Separate assets that are commingled (for example, used for household expenses or mixed into joint bank accounts) may also be transmuted or turned into community property. A Will covers how an individual’s property is divided on death. If the deceased person is married, then the Will can define how all of the deceased spouse’s separate property and his or her one-half share of community property are distributed. The person making the Will can decide what happens to this property and to whom it will be given. The other basics: Durable Power of Attorney and Health Directives.A
durable power of attorney is a document in which an
individual names another person as their agent or "attorney in
fact." The individual authorizes the agent to act on his or her behalf with third parties such as Social Security, Medicare, banks, landlords, title companies,
stockbrokers, etc. Most often, a durable power of attorney only comes into effect if an individual cannot act for himself or herself. Either one or two doctors must determine that an individual no longer has capacity. If the individual regains capacity, the power of attorney will no longer in be in effect. “Durable” means that the agent can still act when the person granting the power of attorney becomes disabled. How can a living will or advance care directive help in the event of physical or mental disability? Planning for your own future includes giving advance instructions on the health care you want if you are unable to state your decisions due to illness or incapacity. You name a trusted person who will ensure that your wishes regarding health care are carried out. You may also wish to set clear instructions or limits for the medical circumstances in which your life should be prolonged, based on your personal values or religious and spiritual beliefs. How can you protect your minor children?It is extremely important to name a guardian for minor children in a Will.
Families with children should think seriously about who should be
guardian of minor children if both parents die. Sometimes a grandparent
or older relative may be a good choice; at other times an older person
may not be able to take on the responsibility of raising a young child. You can secure the financial future of minor children by establishing a testamentary trust in a will. Sometimes insurance benefits may be the key to children's financial security. A trust can include instructions for how funds are distributed for a minor's benefit, for example, for educational purposes or to cover anticipated special needs. The trust can also be set up so that assets are held until a minor comes of age or a young person achieves certain goals. What about domestic partners?Couples that live together on a permanent basis outside of marriage do not have the protections that state laws governing marriage provide. They may acquire property, share income or raise children together, but in the absence of a valid marriage, written contracts are often the best available means for cohabitants to determine their own legal future.Some different-sex cohabitants might actually find it easier simply to get married when they realize how extensive such contracts must be if they are to address all the rights and duties that marriage automatically confers, and when they consider the various benefits of marriage which cannot be acquired by contract alone. At this point, in New Mexico, same-sex partners don’t have that option. Domestic partners can provide a formal legal structure for their relationship with a will, trusts, powers of attorney, a durable power of attorney for health care, a living will declaration, contracts to jointly purchase property, real property titles, insurance beneficiary designations, legal adoption decrees for minor children, and a written cohabitation agreement. A cohabitation agreement can cover many of the responsibilities addressed in marriage laws including the identification of property and debts brought into the relationship, income and support, tax issues, division of household duties and expenses, insurance, health and medical care, conflicts arising upon possible termination of the relationship including support rights, death, responsibility for children, and pension rights. For more information on domestic partnerships, see Planning for Nontraditional Families on this website. The materials available at this web site are for informational purposes only. They are not legal advice or a substitute for legal advice. Every situation is different. You should contact your attorney to obtain advice on your particular issue or problem. Use of and access to this Web site or any of the e-mail links contained within the site do not create an attorney-client relationship between the law office of Kate Fitz Gibbon and the user. The opinions expressed at or through this site are the opinions of the individual author alone. |