Estate Planning when you Live in Two States

Many people choose to live in one state for part of the year and in a different state for the other part of the year. When it comes to estate planning, this can cause some confusion. The general rule is that the state of your “legal residence” controls. Your legal residence is the state that you designate as such. An individual typically does this by living in the state for at least 183 days out of the year and holding his or her driver’s license, vehicle registrations, voting rights and bank accounts in that state.

When you live in two states, if properly planned, you get to choose which state is more beneficial to you for estate planning purposes. As a result, it is important to seek legal counsel in making this decision so you can fully understand which state’s tax laws would be more advantageous. Your estate plan can be significantly impacted because some states have state tax laws in addition to the federal estate tax law. You can save significant income and estate tax by making the right decision.

You should almost always use a trust if you own property in two states. Otherwise, it is likely that your loved ones will have to go through the probate process in one or both states. A trust can hold both pieces of real estate and help avoid the time-consuming and costly probate process.

It is also important to note that you should create certain documents that are correct and effective for each state. For example, you should probably have a Durable Power of Attorney and Advance Medical Directive in each state to make sure you are protected if you encounter unexpected events or require medical decisions to be made on your behalf, and which are compliant with the laws of both states.

If you have questions regarding creating an estate plan when you live in two different states, contact us for the answers you need.

To learn more about how a trust can benefit your family, call us today. The Astill Law Office has provided high quality legal services for over 30 years. We specialize in wills, trusts, estate planning, and asset protection. If you have any questions about creating a Trust, Will, or estate planning in general, contact The Astill Law Office at 801-438-8698.