Understanding Pour-Over Wills
Oct. 5, 2022
Estate planning is a complex process that helps accomplish many goals, including preparing for your future and ensuring that your loved ones are taken care of in the event of your death. A pour-over will is a great addition to your estate plan when paired with a living trust. However, many people do not understand what a pour-over will is and why they need a "will" when they are already doing a living trust.
If you are looking to set up a pour-over will, contact a skilled estate planning attorney. Our attorney at Moses Estate Planning, PLLC helps clients make informed decisions about their estate plans. With an office in Coeur d’Alene, Idaho, we represent clients throughout Kootenai County. From our office in Santa Monica, we also serve the estate planning needs of individuals and families in Los Angeles and surrounding areas in California.
What Is a Pour-Over Will?
A pour-over will is a type of will that is commonly used with a living trust as part of an estate plan. A pour-over will dictates that all assets that have not been titled under the name of the living trust be transferred (poured) to a living trust at a person’s death. While the primary goal is to have all assets funded to one's living trust, sometimes a creator of a living trust will purchase real property after the creation of the living trust and will simply forget to retitle the new property in the name of the living trust. In such a case, the pour-over will ensures that the property ultimately "pours over" into the living trust and will be distributed to the individuals named as beneficiaries in the living trust.
By establishing a pour-over will during your lifetime, you can tie up loose ends by directing that all assets held in your name are ultimately funded to your living trust. Therefore, if you set up a pour-over will, any assets that you either intentionally (or unintentionally) do not fund to your living trust during your lifetime will ultimately be "poured over" into the trust.
What Happens If I Don’t Have a Pour-Over Will?
Now that you know what would happen to your assets if you established a pour-over will, you may wonder what happens to your assets that were “left behind” if you pass away without a pour-over will.
Any assets that were not transferred to the trust will be subject to the intestate succession law. Intestate succession means that assets will pass to certain heirs in a predetermined order. Thus, unless you have a pour-over will, your assets may pass to those you do not want to inherit from your estate.
Intestate succession laws differ from one state to another. For example, in Idaho, the surviving spouse is entitled to 100% of the community property and 50% of the deceased spouse’s separate property. The remaining half of the separate property is distributed to the decedent’s children, parents, or other heirs.
Pros and Cons of a Pour-Over Will
If you are considering establishing a pour-over will, you need to understand the advantages and disadvantages of the will. Some of the most prominent pros include:
Simplicity. Creating a pour-over will is a relatively straightforward process. In addition, having this kind of will makes it easier for the executor and trustee to handle the distribution of your assets according to your wishes.
Tie up loose ends. Having a pour-over will helps ensure that all of your assets, including assets outside of your living trust, will pass to the intended beneficiaries.
The primary disadvantage of a pour-over will is that it will go through probate like any other will. Probate can be a lengthy and costly process, which is why it is important to continually make sure that all of your assets have been funded to a living trust during your lifetime to avoid or minimize probate.
The Duties of the Executor/Trustee
If you are considering establishing a pour-over will, you need to understand the duties of the executor and trustee. As you may know, you can name a person to serve as the executor of your estate in the will. The same can be said about pour-over wills that name the executor of the estate.
The executor of the estate named in the last will and testament has a variety of duties, including but not limited to settling debts, paying taxes, and collecting the assets of the deceased. The executor of the estate named in the pour-over will has one duty: to transfer all of the assets that remain in the decedent’s individual name into the living trust.
Once the assets are transferred into the trust, they become the responsibility of the trustee. As the trustor, you name the trustee when setting up a living trust. The main duty of the trustee is to distribute the assets held in the trust to the trustor’s beneficiaries. Unlike executors, trustees do not need to seek approval from the probate court to perform their duties.
Experienced Guidance Every Step of the Way
Regardless of the size of your estate, it is crucial to ensure that all of your affairs are in order. However, it is not uncommon for people to forget to address certain assets while funding a living trust during their lifetime. That’s where a pour-over will can save the day. Seek legal guidance from our estate planning attorney at Moses Estate Planning, PLLC if you are considering establishing a pour-over will.