Sound advice in uncertain times:

Who Gets Assets Without a Will?

By: Rilus M. Dana

Your will is the legal document explaining the distribution of your personal property after your passing. Essentially, it allows you to allocate your assets according to your wishes. However, who gets assets without a will? Does everything go to the state?

First, when somebody dies without a will, that is called dying intestate. Each state has its own laws of intestacy that determine how your estate is handled. We’ll dive a little deeper into how Arizona handles intestate estates.

What Does an Intestate Estate Consist of?

In Arizona, the estate in question consists only of assets that are subject to probate, the court-supervised process of retitling assets out of the name of someone who has died. Therefore, the intestate estate does not include any assets covered by a non-probate transfer or titled in a trust. That means anything with a beneficiary designation, such as life insurance, IRAs, financial or investment accounts, and anything held in a trust, are not included in the intestate estate.

What is Intestate Succession?

If you die without a will in Arizona, the probate code designates that your assets pass through intestate succession. Essentially, this means that any assets or property in the intestate estate go to the deceased’s spouse and/or other heirs. The laws of intestacy outline the division of assets and order that your next of kin will be considered in.

The only exception to this process is if you named beneficiaries through other methods, such as payable on death or transfer on death designations, or held title to property with rights of survivorship. Otherwise, succession will follow the procedures listed below.

Which Assets Go to Whom?

So, who inherits what? How is the intestate estate divided? According to the Arizona intestate inheritance rules, this is how assets are divided:

• No Surviving Spouse - If the deceased is not survived by a spouse, the entire estate will pass to their heirs. In Arizona, “descendant” refers to all of the deceased’s descendants of all generations. Therefore, the estate will go to their next of kin starting with their children. If there are no children, then parents and siblings would be next. If there are no surviving parents or siblings, the probate court would track down more extended family, such as nieces and nephews, grandparents, grandchildren, and so on.

• A Surviving Spouse and No Surviving DescendantsThe surviving spouse will receive the entire estate.

• Surviving Spouse and Surviving Descendants (that are not descendants of both the deceased and the surviving spouse) - If the deceased’s surviving descendants are not related to the surviving spouse, determining who gets what can get a bit complicated. Generally, it depends on whether the intestate estate is the deceased’s separate property (received before marriage) or community property (received during marriage). In Arizona, surviving descendants are entitled to one-half of the separate property and all of the deceased’s share of intestate community property.

• No Surviving Spouse or Descendants - First, the probate court will search for immediate and extended family to receive the estate. However, if they can’t find any next of kin, the entire estate will go to the state of Arizona.

An Important Question: Who Doesn’t Get Assets Without a Will?

Intestacy laws are essential because statistics still say that half of American adults don’t have a will or estate plan. However, the law doesn’t consider unmarried partners and can make probate for blended families incredibly stressful. If you have an unmarried partner, they will only receive assets you are jointly titled on with rights of survivorship and those that you complete a beneficiary designation for. If you are married and have children from a prior relationship, the law may force your spouse to sell your family home to give your children their inheritance. They are entitled to all of your half of intestate community property.

We’ve seen the unfortunate impact on loved ones when somebody dies without a will. It is the key motivation for most people who create an estate plan. If you’d like to prevent your family from going through

Helpful Advice from the IRS

Tax season 2023 has arrived. Here are some suggestions that can help to keep your stress level down when preparing your 2022 tax returns.

1. Be organized: Have all your tax documents in one place before you begin to prepare your tax return. This will make it easier to complete your tax return and you’ll spend less time hunting for missing documents. You don’t need to have everything in perfect order. Gather all your tax documents as they come in and keep them in one place. I use folders or envelopes. Old Amazon boxes work, too. Before you begin, separate the documents between the ones that report income such as W-2s and 1099s, and the ones that report deductions such as medical and charitable contribution receipts.

2. Have a copy of your 2021 tax return handy: Your prior year’s tax return can serve as a guide when preparing your current year’s return. Unless your income and deductions changed significantly in 2022, the amounts reported in your 2022 tax return should be similar to the amounts in your 2021 tax return. You should also check your prior year’s return for carryovers including capital losses, net operating losses, charitable contributions, credits, and basis of assets.

3. File electronically: Although you can file a handwritten paper tax return, if you have a computer or a smartphone, you may want to look into tax software such as TurboTax. For a small fee, you can feel confident knowing that your tax return is correct without having to double-check your math. Electronic filing along with direct deposit will get your tax refund to you much faster than requesting the IRS mail a check to you. A refund deposited directly into your checking account with an e-filed return generally takes about two weeks. I have heard of refunds from paper-filed returns taking up to six months or more!

4. Due date: The normal due date for filing tax returns is April 15. If that date falls on a weekend or a holiday, tax returns are due the next day that the IRS is open. In 2023, April 15 falls on a Saturday, and the IRS is closed on weekends. Monday, April 17, is Patriot’s Day, a holiday in Massachusetts where the IRS’ Andover Service Center is located. Because of this, 2022 tax returns are not due until April 18, 2023.

5. If you need more time: If you can’t file your tax return by April 18 you can get an automatic six-month extension to file until October 17. Because the IRS automatically grants a properly filed extension request, you don’t need to provide a reason why you want more time to file your return. Please note that, at the very least, write your own will. It’s free and completely legal to do. It won’t prevent probate, but it will prevent your estate from being intestate. To make sure your assets and property are divided according to your wishes, it’s best to seek out an experienced estate planning attorney. that although you receive an extension to file your tax return, you do not receive an extension to pay any balance due with your return. Any balance owed on your tax return is still due by April 18.

-Rilus M. Dana, J.D. is the Managing Partner at Dana and Associates, LLC.

6. IRS resources: The IRS website, www.irs.gov, is a great place to find information on many topics related to taxes. At the top of the IRS’ home page you’ll see the following:

• File – Click on “File” for information about filing both individual and business returns as well as other filings. You’ll also find where to apply for an Employer ID Number or an Identity Protection PIN.

• Pay – You can make payments to the IRS from your checking account or with a debit or credit card for many types of taxes including return balances due, estimated taxes, and IRS notice balances. You can also set up a payment plan if you owe more than you can pay at once.

• Refunds – Look here to find the status of your tax return if it doesn’t arrive when expected.

• Credits and Deductions – You can find information here on a wide variety of subjects including refundable and nonrefundable tax credits, personal and business deductions, and other credits which may help to reduce your tax liability.

• Forms and Instructions – You can get answers to many questions about filing taxes here. IRS publications are also found here. I highly recommend IRS Publication 17, Your Federal Income Tax for Individuals. This guide has an extensive index and covers many areas of taxation with examples to help explain various subjects.

An American professor and academic administrator, who currently serves as the president of Prairie View A&M University, a historically black college in Texas. She previously served as the president of Brown University from 2001 to 2012 which made her the first African-American and first female president of an Ivy League Institution.