Inheritance Law Louisiana has very strict probate and succession laws that control where property goes after someone dies. If there is no will, the state has a succession order set forth under the statutes in which certain assumptions are made. The first assumption is that the spouse should not inherit anything from the other spouse if there are children. The next assumption is that for separate property, nieces and nephews should inherit before a spouse. This usually comes as a big surprise to the surviving spouse. Major changes The Louisiana Legislature enacted some major changes to Louisiana succession law. Once of the major changes was to begin the elimination of our venerable inheritance tax. This tax has often been confusing and has caught heirs by surprise at times. On July 1 of 2004 it was eliminated for those dying on or after that date. However, the tax will still be applied for those who do not open a succession within nine months of death or file a trust with the Department of Revenue. This will catch quite a few people. Related Topics Alternates to probate: There are situations where probate is not necessary. In Louisiana, probate is not required is there is no will, no real estate, and the estate is under $50,000 in total value. Probate can also be avoided with various estate planning techniques, such as revocable (living) or irrevocable trusts. Types of successions Successions in Louisiana are considered either testate or intestate. If the deceased had a will that was probated, then the succession is considered testate. If the deceased did not have a will, then the succession is intestate. With a testate succession, the provisions of a will control most of the dispositions. In an intestate succession, the statutes determine who inherits and in what proportions. Here are the most common questions about probate that we have encountered: Probate questions: What does happen to property when someone dies? There are two things that are looked at: (1) was the property community or separate; and, (2) what relationship are the survivors to the deceased? Community property is usually property accumulated by a couple while they are married (unless there was a marriage contract). Examples of separate property would be property owned before marriage, inherited property, or property given to one of the spouses. In general, a spouse inherits none of the other spouse's separate property. A spouse also inherits none of the other spouse's community property unless there are no children of the marriage. Can this be changed with a will? Yes, most certainly. A will can specify that a spouse comes ahead of other heirs. If there are forced heirs, the forced heirs have to inherit a portion, but the will can provide that the remainder go to the spouse (or anyone else named in the will). The will can also give the spouse a lifetime usufruct over the forced portion. A usufruct is a limited right to the use of a thing. In other words, if you have a usufruct over stock, you would be entitled to the dividends from that stock. A usufruct granted in a will can even be worded to allow the person with the usufruct to sell the stock. What is a forced heir? At this point in time, a forced heir is any child of the deceased who is under the age of 24 years. Once a child reaches age 24, he or she is no longer a forced heir. A forced heir can also be a child, regardless of age, who is permanently disabled. So, you could have a child who is a forced heir until age 24, no longer is a forced heir, and then has a stroke at age 40 which makes him a forced heir once again. Does all property have to go through probate? Some types of property are not considered part of your estate in Louisiana. Normally, property that is paid directly to a named payee by a third party is not subject to succession laws. For example, any retirement asset, like an IRA or 401 (k), would not have to go through probate and would not be subject to Louisiana's inheritance tax. It is important, however, to remember to have alternate beneficiaries named on the account. If you name only your spouse and both of you die, the asset would have to go through probate. Proceeds of life insurance are another example of an asset that does not go through probate as long as there is a living named beneficiary. Do I need a will? A will can do many things. The most important thing a will can do is change the order of succession that Louisiana provides in the absence of a will. A will can also do many other things, for example: 1) name a guardian for minor children; 2) name an independent executor which can save probate costs; 3) create a trust for grandchildren, special needs or spendthrift heirs; 4) for larger estates, make provisions to save estate taxes; 5) remove any doubt as to what you wanted after your death. If none of this is important to you, then you may be satisfied with the Order of Succession that Louisiana has for you: Typical Question: Q: "My boyfriend and I have lived together for 7 years. We have a child together, he also has two children from a previous marriage. We have assets that are paid in full under both our names and some that are under just his or my name, and some that are not paid out yet. Our home is under just his name. He does not have a will nor do I. My question is, if something would happen to him would I lose everything to his ex and their two children?" A: "Everything in his estate would go to his three children. Since you are not married, you would receive nothing. Things in your estate are yours regardless of what happens to him. Things you have purchased with your own money or things you had before you knew him belong to you. So, if everything in his estate goes to his three children, in effect the ex gets control of what goes to her two children (assuming they are minors) and one third goes to your child under your control." Q: "Thank you. But that is horrible. He thinks I will get it all. I will have to tell him he is very wrong. What if he has a will that states I get all or a percentage of his estate. Do I still get nothing?" A: "He can leave you everything in a will. But, any children under the age of 24 are forced heirs which means they have to get a percentage of his estate. Assuming two of the kids are under 24, he could leave you one-half of his estate and the kids the other half. The forced portion that has to go to the kids is 25% if there is one kid or 50% if there are two or more kids. Whether there are two or twenty, they have to divide the fifty percent among themselves." Order of Succession in Louisiana Community Property 1. To children or children's descendants, with usufruct to spouse. If nobody exists in this group, then............... 2. To spouse, if there are no children or descendants of children. If nobody exists in this group, then................. 3. To brothers and sisters with usufruct to parents, if parents are alive. If nobody exists in this group, then.................... 4. To nieces and nephews, or their descendants, with usufruct to parents, if parents are alive. If nobody exists in this group, then............ 5. To parents, if there are no brothers or sisters, nieces or nephews, or other descendants. If nobody exists in this group, then................ 6. To grandparents or other ascendants. If nobody exists in this group, then................. 7. To nearest collateral relative. If nobody exists in this group, then........ 8. To State of Louisiana. Separate Property 1. To children or children's descendants. If nobody exists in this group, then............... 2. To brothers and sisters with usufruct to parents, if parents are alive. If nobody exists in this group, then................... 3. To nieces and nephews, or their descendants, with usufruct to parents, if parents are alive. If nobody exists in this group, then............. 4. To parents, if there are no brothers or sisters, nieces or nephews, or other descendants. If nobody exists in this group, then................ 5. To spouse. If there is no spouse, then.................. 6. To grandparents or other ascendants. If nobody exists in this group, then................ 7. To nearest collateral relative. If nobody exists in this group, then......... 8. To State of Louisiana. Source: la-legal.com THIS INFORMATION IS NOT MEANT TO BE A SUBSTITUTE FOR LEGAL ADVICE. WE RECOMMEND ALL WILLS, ESTATE PLANNING, OR OTHER ESTATE MATTERS BE HANDLED BY AN ATTORNEY COMPETENT IN LOUISIANA SUCCESSION LAW. |
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