Taking the first steps to estate planning can be confusing without the help of a distinguished wills attorney. Understanding the terms used in writing your Last Will and Testament can help when planning for the future of you and your family.
Frequently, attorneys get calls from family members or friends saying a parent or a friend has passed away and that they need assistance for administering the estate. The decedent is the technical term for that individual who has passed away.
An heir of a Will at law is a person who may be entitled to receive a distribution from an estate in the event the decedent has not left a Last Will and Testament. Heirs are related by a linear bloodline. When an individual does not leave a Last Will and Testament, the heirs are determined by Maryland law.
For example, if a person dies and has three siblings, but no spouse, children, or living parents, the person’s three siblings would be equal heirs at law pursuant to the Maryland laws of intestacy. Maryland laws of intestacy may or may not provide for what an individual would have wanted had he or she had the opportunity to create a Last Will and Testament during their lifetime.
A beneficiary of a Will is called a legatee in Maryland. A legatee is an individual named in the Last Will and Testament to inherit or receive a distribution from an individual’s estate. A legatee differs from an heir in some cases because a legatee could be anybody that the individual chooses. An heir, on the other hand, is a person who is an heir at Maryland law when a person dies without a Last Will and Testament, based on the Maryland laws of intestacy.
In Maryland, the term in a Will for the executor is Personal Representative. A Personal Representative is an individual nominated to administer the estate. It is the person who has the fiduciary obligation to manage the estate on behalf of beneficiaries or the legatees in the event that there is a Last Will and Testament or on behalf of the heirs in the event that the testator or the individual did not leave a Last Will and Testament.
The primary function of an executor or a Personal Representative in Maryland is to marshal the assets of the decedent’s estate, pay any legally enforceable claim or debts, ensure the required income and estate tax returns have been completed, and make distribution pursuant to the Last Will and Testament or to the Maryland laws of intestacy.
A grantor is a term used in trusts. It is the person who is creating the trust document and “granting” the assets to the trust. A grantor is another term for settlor or the individual who has created that trust.
A testator is the individual writing the Last Will and Testament. For example, it is the person who has executed the documents and who is leaving their assets.
A holographic Will is what is handwritten by the testator.
A codicil is an amendment to a Last Will and Testament. If an individual chooses to make a change, the individual may choose to create a new Will or create a codicil, which is an amendment to the individual’s prior will. The interesting thing about a codicil is that it must be executed in the same manner as the execution of a will and pursuant to Maryland law, which is typically how the original will was also written. The individual writing the codicil has to have the required testamentary capacity just as if he or she was creating a new Last Will and Testament.
An attestation clause is required by Maryland law. Basically, it is an attestation from an individual who witnesses that it is a Last Will and Testament of the testator, that he or she was of sound mind or has the required testamentary capacity, and that the individual witnessed the signing of the Last Will and Testament.
In Maryland, abatement is a concept that occurs when an individual’s Will does not have enough assets to satisfy all of the bequests or distributions. For example, an individual may leave $20,000 to one relative, $20,000 to another, $20,000 to a charity, and the remainder to their sibling. If the decedent’s assets at the time of death, after the payment of all expenses, taxes, administrative costs, and debts did not have adequate assets to fill all of those bequests, the will starts to abate from the end of the document, or the distributions begin to lapse from the end of the document. In this example, that means if there was $60,000 in the estate, the sibling may not receive any money, but the charity, the niece, and the nephew would still receive their distributions.
Intestacy is a default set of laws provided by the State of Maryland that provides for what happens when an individual dies without a valid Last Will and Testament. The Maryland laws of intestacy provide for how the assets are distributed in the Will. Intestacy laws also provide for the payment of claims and creditors as well as an order of priority for who can serve on behalf of the estate to act as Personal Representative.
Contacting an Estate Planning Lawyer
The estate planning lawyer will be up to date on all the local laws relative to your assets and Will. Not every term will apply to your Last Will and Testament, however, understanding the Maryland legal terms for one’s Will can help in the preliminary steps to planning for one’s future. An experienced estate planning lawyer can help you understand how these terms pertain to you and your family when planning your Last Will and Testament. It is invaluable to understand the importance of someone’s role and the future role of other family members when planning their Will.