Understanding Wills, Community Property & Probate


Understanding...

Dying Without a Will in Washington,
Community Property, and Probate 



Dying Without a Will in Washington State

If you pass away without a Will in Washington State, state law determines who gets your property and makes other important decisions for you.

Disposition of Your Property

Washington law distinguishes between community property and separate property. Community property is generally all property earned or acquired by you and your spouse during your marriage.  Separate property is generally any property you owned prior to the marriage and any property you receive during the marriage by gift or inheritance, and also includes anything you purchase with your separate property during the marriage.

Property Rights of a Surviving Spouse

Your spouse inherits your interest in all your community property if you die without a Will. Your spouse will also receive all of your separate property if you die without leaving any children or grandchildren, and your parents also fail to survive you.

If you die and have a surviving spouse and also have children or grandchildren who survive you, your spouse will receive all of your community property and one-half of your separate property.

If you die and have a surviving spouse, but no surviving children, and have at least one parent who survives you, your surviving spouse will receive all of your community property and three-quarters of your separate property.

Your spouse is free to dispose of property received from your estate in any way he or she likes, including making a Will that leaves it to a new spouse or to his or her children from a prior marriage.

Property Rights of Children and Descendants

Your natural children and adopted children will receive all of your community property and separate property if you pass away and do not have a surviving spouse. Stepchildren and foster children will receive nothing. Your children and grandchildren who inherit receive property by right of representation. 

Representation is a legal term that means your descendants of the same degree, for example children, share equally. If you have a child who has passed away who leaves children, that child's equal share of your property passes to that child's surviving children in equal shares.

As described above, if you pass away and are survived by a spouse, your children will receive none of your community property and one-half of any separate property you own. There is a legal presumption that all the property you own at death is community property, if you die and are survived by a spouse. The burden would be on your children to prove that any property is separate property.

As a side note, minor children who inherit property will be entitled to their inheritance at age 18 without any limitations on its use. All adult children or other descendants inherit property with no restrictions on its use.

Property Rights of Parents and Siblings

Your parents will receive all of your community property and separate property if you die and do not leave a surviving spouse, children or grandchildren. If your parents both fail to survive you in this case, your property will pass to your brothers and sisters by representation.

Your parents will receive none of your community property and one-fourth of your separate property, if you pass away with a surviving spouse but leave no children or grandchildren.

Your parents will not receive any of your property if you pass away without a surviving spouse, but leave children or grandchildren who survive you.

Administrator of Estate


If you die without a Will, the court will need to appoint a person to administer your estate.

Washington law provides that the following people, in the following order, have the right to administer your estate:

1. Your surviving spouse or state registered domestic partner;
2. Your children;
3. Your father or mother;
4. Your brothers or sisters;
5. Your grandchildren;
6. Your nephews or nieces;
7. A trustee, guardian or attorney-in-fact named by you during your life-time; or
8. A principal creditor of your estate.

If the person or persons entitled to serve fail to present a petition for appointment with the court for more than 40 days after your death, the court can appoint any suitable person to administer your estate.

Where more than one person is entitled to serve, such as your children, it may turn into a race to the courthouse to see who gets appointed as administrator of your estate.

Guardian of Minor Children


The court will appoint a guardian of any minor children, if you are not survived by a spouse. Any person the court determines is suitable may serve as guardian except a person under 18 years of age, of unsound mind, or convicted of a felony or of a misdemeanor involving moral turpitude.

CONCLUSION


If you do not like the estate plan and provisions that Washington State law dictates if you die without a Will, you can prepare a Will that meets your desires.


Community Property Agreement

What is Community Property?

In general, under Washington state law, Community Property is all property acquired by a husband or wife after marriage. Under Washington law, a husband and wife are each effectively considered as owning one-half of the couple’s Community Property. A marital partner’s Last Will and Testament passes interests in his or her one-half share of the couple’s Community Property, along with interests in all of his or her Separate Property owned at death.

What is Separate Property?

Washington law provides that property acquired by an individual prior to marriage, including the right to receive payments on the property or to receive proceeds from the sale of such property, is the Separate Property of the individual. Property acquired after the marriage by gift, bequest, devise, descent, or inheritance, along with the rents, issues, and profits from such property, is also the Separate Property of a married individual.

Can Separate Property be converted to Community Property?

Separate Property can be converted to Community Property by a formal “gift” of Separate Property to the marital community or by commingling Separate Property with Community Property. For example, if Joe and Sue are married, and if Joe receives a gift of $100,000.00 from his father, the $100,000.00 is Joe’s Separate Property. But if Joe puts the $100,000.00 into a bank account in both Sue’s and his name, he has commingled the $100,000.00, which most likely converts it to Community Property.

What is a Community Property Agreement?

Washington law allows a married couple to enter into an agreement defining the character of the property owned by them. This includes the ability to enter into an agreement that upon the death of the first spouse to die all of the property owned by them will be treated as Community Property, and will automatically pass to the surviving spouse.

What is the effect of a Community Property Agreement upon death of a spouse?

A Community Property Agreement that converts all of a couple’s property to Community Property, and passes it to the survivor of them upon the death of the first to die, results in all the couple’s property passing to the survivor of them upon the death of the first spouse to die. This avoids having to go through the Court process of probate, in order to pass the deceased spouse’s one-half share of the couple’s Community Property and any Separate Property, to the surviving spouse.

When would a Community Property Agreement to pass all of a couple’s property to the survivor, be a bad idea? 

A Community Property Agreement passing all of a couple’s property to the survivor of them on the death of the first to die is not always a good idea. For example, if the value of a couple’s combined Community Property and Separate Property exceeds $2 Million, using a Community Property Agreement to pass all assets to the surviving spouse upon the death of the first could subject the estate of the survivor to unnecessary Washington estate tax.

A Community Property Agreement is rarely desired by spouses in a second marriage when there are children from a prior marriage. A spouse with children from a prior marriage may desires to pass at least some property to his or her children from a prior marriage upon death. Also, a Community Property Agreement would not be advisable if a person wants to leave a gift to a charitable organization at the time of his or her passing.


Probate in Washington State

What is Probate?

As a probate attorney, one of the most common questions I get asked is “what is probate?” I would generally describe probate as the legal process for administering the probate estate of a deceased person. Not all assets are probate assets. For example, life insurance proceeds or other accounts that pass by beneficiary designation and real property owned as joint-tenants with right of survivorship are non-probate assets that pass automatically at a person’s death.

The probate process involves the following:

Proving of the Will:

If the deceased person left a Will, the Will is presented to the Court for verification of its authenticity and for the Court to “admit” the Will to probate.

Appointment of a Personal Representative or Personal Administrator:

Whether there is a Will or not, a person is appointed to administer the estate of the deceased person.  The estate of a deceased person consists of his or her Community and Separate Property that is subject to probate. The person appointed to administer the estate of a deceased person is the Personal Representative, if named in the Will, or the Personal Administrator, if there is no Will.

Control and Manage Estate Assets:

Once a Personal Representative or Administrator is appointed, it is his or her duty to take control of the deceased person’s property and manage it as the owner. Essentially, the Personal Representative steps into the shoes of the deceased person regarding control and ownership of assets. Part of this duty includes making sure property is protected and continues to be insured. It also includes opening a bank account for the estate.

Notify and pay creditors of the Estate:

The creditors of a deceased person have a right to receive the assets of the estate before the named beneficiaries in a Will or the heirs of the estate of a person who died without a Will. The Personal Representative generally will publish Notice to Creditors of his or her appointment in a newspaper in the county where the deceased person resided at death. This is legal notice to unknown creditors (creditors who could not be identified with reasonable effort) that the person has passed away and his or her estate is being probated. Unknown creditors will generally have four months from the first date of publication of the notice to file a claim against the estate or have their claims barred.

The Personal Representative must send actual notice to “reasonably ascertainable” creditors of the deceased person or those creditors will have two years from the date of death to file a claim against the Estate. If actual notice is sent, the known creditor will have the later of thirty days from the date of mailing of the Notice to Creditors or the expiration of the four month period after the date of first publication.

Once creditors of the estate have made claims, the Personal Representative reviews the claims and either accepts or rejects them. The accepted claims can then be paid from the assets of the estate. If the estate is insolvent, meaning the estate’s debts exceed its assets, the process of paying claims can be more involved and most creditors will receive a pro rata share of available funds based on the amount of the creditor’s claim.

Taxes:

The Personal Representative or Administrator of an estate is responsible to file the final income tax return of the deceased person and to file any income or estate tax returns that must be filed. The estate of a deceased person is treated as separate tax entity from the deceased person and must obtain its own tax identification number in order to open a bank account and file income tax returns.

Inventory & Accounting:

A duty of the Personal Representative or Administrator of an estate is to complete an Inventory of the estate’s assets. The Personal Representative is also required in most cases to provide an accounting of income, expenses, and distribution of estate assets. Under Washington law, the Inventory is required to be completed within three months of the Personal Representative’s appointment by the Court. Any beneficiary or heir of the estate has a right to request and receive a copy of the Inventory.

Distribution of Assets:

Once creditor claims of the estate have been paid or provided for, the Personal Representative or Administrator distributes the assets of the estate to the beneficiaries named in the Will or to the heirs of the estate as determined by state law if the person died without a Will.

Closing the Estate:

Some court action will be required to close an estate.  It can be as simple as filing a court document called a Declaration of Completion with the Court and sending Notice to the beneficiaries and heirs of the Estate or it might require a court Order based on a Petition and an Accounting filed with the Court.

Disclaimer:

This article is a simplified description of the probate process in Washington.  It does not constitute legal advice.  You should seek competent legal counsel to assist you with your specific legal needs.


This information was provided by:

Attorney Levi E. Liljenquist

Witherspoon Brajcich McPhee, PLLC
601 W. Main Avenue, Suite 714
Spokane, Washington 99201
Direct Line (509) 252-5659
Office: (509) 455-9077
Fax: (509) 624-6441
lel@workwith.com  
http://workwith.com/