Distribution of Estates to Heirs or Beneficiaries in Maryland
Assets pass by beneficiary designation, such as life insurance policies and retirement assets. If an asset has been jointly titled, then the titling of that asset would pass by operation of law outside of the scope of either the laws of intestacy or a decedent’s Last Will and Testament. Assets that are pre-funded into a trust pass pursuant to the terms of the trust and outside of probate. Any assets titled in the decedent’s sole name with no beneficiary or no joint owner would be available in the probate process either to be distributed through the provisions of a Last Will and Testament or pursuant to the laws of intestacy.
Handling distribution of estates to heirs or beneficiaries in Maryland after the loss of your loved one can be difficult to navigate without the help of an experienced Wills attorney. A Maryland Wills lawyer can help you understand your role after the death of your loved one.
What is commonly misunderstood in the distribution of estates to heirs or beneficiaries in Maryland is that individuals or heirs think that the totality of the assets, regardless of titling or beneficiary designations, are included for estate purposes. That is not the case. If an individual left all their assets by beneficiary designation, then regardless of the provisions of a Last Will and Testament, the asset would pass to the named beneficiary by operation of law.
For example, if an individual passed away with all of their bank accounts titled jointly with one child, even though they may have written a Last Will and Testament or there were individuals that were entitled to inherit under the laws of intestacy, there would no longer be any assets governed by the laws of intestacy or the Last Will and Testament. One child would inherit the all of the assets by operation of law.
The estate assets do not escheat to the State of Maryland unless there are no heirs at law or blood relations to the fifth degree, meaning that there are no longer any heirs as provided by Maryland law, in which case Maryland will become the default beneficiary. That is a relatively uncommon scenario. Many individuals typically have at least one heir, even if it is a remote cousin. The laws of intestacy or decedent’s Last Will and Testament are applicable only to those assets in an individual’s sole name on the date of their death without beneficiary designation or joint titling. At death, assets generally pass in four ways.
Laws of Intestacy and Same-Sex Spouses
Since the repeal of a Defense of Marriage Act, same-sex partners are permitted to marry in all states. Under Maryland law, the marriage is treated exactly the same way as for opposite-sex couples. Therefore, a same-sex spouse would have the same statutory rights and priority as opposite-sex spouses when distributing estates to heirs or beneficiaries in Maryland.
Absence of a Will
Often when an individual does not have a valid Last Will and Testament, it is indicative that they may not have prepared in any way for the disposition of their assets at death. Sometimes that can relate to elevated costs, because the totality of a decedent’s assets may not be easily ascertainable. There may not be much information regarding where assets are held. A Personal Representative and their attorney may be searching for assets or searching to verify what assets remain in the individual’s name at death.
Without the benefit of the prior distribution of estates to heirs or beneficiaries in Maryland, often issues that could have been addressed prior to death are still left unresolved, meaning there is little opportunity to plan or to minimize estate taxes or prevent family disputes. There is also perhaps little opportunity to minimize some administrative expenses that could be involved in the distribution of estates to heirs or beneficiaries in Maryland. For example, if an individual passes away without a Last Will and Testament and without family members or friends familiar with his or her assets, it could take a long time to sort through an individual’s papers and documents to determine what assets he or she had at death.