What Happens to Assets if There Is No Will?
First, forget anything you have heard about the State getting any portion of your assets because you did not prepare a will. This notion is pure nonsense (unless you have absolutely no surviving family). So, if the State does not inherit your estate, who does?
What Is Michigan Intestacy Law?
The legal term for someone dying without a Will is “intestate”. If you die intestate in the state of Michigan, your assets are divided according to Michigan's intestacy laws.
These laws are different depending upon your marital status at the time of your death and whether you had:
- Children
- Surviving parents
- Or siblings
Example of Michigan Intestacy Law
For example, MCL 700.2102 specifies what happens when the decedent leaves a surviving spouse. It is not as simple as “everything goes to the spouse”. The surviving spouse would receive the entire estate only if the deceased person had no surviving parents, children, or grandchildren.
If there were surviving relatives, the spouse will receive the first $150,000 of the estate, and then half of the remaining estate. Without a surviving spouse, any surviving children would divide the estate equally.
Under certain circumstances, parts of the estate may also pass to:
- Grandchildren
- Siblings
- And parents of the deceased person
It is important to note a few things when looking at these rules:
- Note the final sentence, MCL 700.2102(2) – this is stating that the numbers mentioned in the statute are adjusted for inflation. The numbers in the statute areas of 2001. In 2017, all numbers are approximately 50% greater than what is printed above in the statute.
- These rules do not apply to property which passes outside of Probate. What this means is that property that is held with a survivor, as joint property with rights of survivorship, will pass outside of probate to the surviving joint owner and will not be subject to these rules. Assets with beneficiary designations (such as you typically find with retirement plans) will pass to the named beneficiary are not subject to these rules.
- There are also various elections that can be made by a surviving spouse, such as exempt tangible property allowances, homestead allowances, etc. which could cause much more than the first $150,000 ($224,000 in 2017, as adjusted for inflation) to pass to the surviving spouse before any other relatives receive any portion of the intestate probate assets.
- There are different rules to deal with a situation in which the decedent had no surviving spouse. The rules are found in other statutory sections and are not discussed here for the sake of brevity.
To achieve clarity regarding who will inherit your belongings, it is recommended that you consult a Michigan attorney about drafting a Will, Living Trust, or other estate planning documents.
If you are looking for a practical and knowledgeable professional that can help you through the estate planning process or if you would like additional information about our Macomb County-based estate planning services, give us a call at (586) 690-4400 or fill out our online contact form.
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