A common question we receive from potential clients is, “What happens to my things if I die without a Will?” This is usually followed by the question, “If I die without a Will, doesn’t everything just pass to my wife/husband?” or by the question, “Does the State get all my things if I die without a Will?”
This short article is meant to explain in simple terms what happens to peoples’ non-beneficiary designated assets if they die without a Will in New Jersey.
Beneficiary Designations and Property Passing By Operation of Law
Having a Will, or not having Will, has no effect on who receives your assets at death if you have named a beneficiary. Some assets, such as IRAs or life insurance policies, typically name beneficiaries. If you do not remember naming someone you can contact your benefits person or life insurance agent for a copy of you Beneficiary Designation Form. If you have an asset that names a beneficiary then this asset passes to the named beneficiary whether you have a Will or not. This also is true for assets that you own jointly with another person, such as a house you hold as “Joint Tenants With a Right of Survivorship” with another person. Your other assets such as stocks, bonds, real estate, furniture, cars or any other thing that you own that has no beneficiary will pass as part of your estate at death. If you have a Will, the Will states who gets these things. If you have no Will, then New Jersey’s Intestate Rules dictates to whom these assets pass.
What it Means if you Die “Intestate”
If you die without a Will you are “Intestate” (without “testament”, meaning without a Will) and your assets pass in accordance with rules set up by the State. These rules were created to clarify property rights to the assets of deceased people without Wills. The rules try to give assets to the person or people that the State believes would have likely received the assets had the deceased person ever gotten around to writing a Will. Sometimes the State gets it right and sometimes it does not.
A common misunderstanding is that if you die without a Will your assets may end up passing to the State. This is possible, but only if you have no surviving relatives, including stepchildren. The intestate rules are set out in Title 3B, Administration of Estates, specifically Chapter 5, Intestacy.
A Breakdown of New Jersey’s Laws of Intestacy
Most people assume that if they die without a Will all their assets pass automatically to their surviving spouse and this is not necessarily true!
The surviving spouse receives everything in an intestate estate in only two sets of circumstances. The first is if the intestate deceased had a surviving spouse but neither surviving issue (children, grandchildren, etc.) nor parents. The second is if the deceased had a surviving spouse and surviving descendants but each of these descendants was also the surviving spouse’s descendants and the surviving spouse had no other descendants. In other words, if the surviving spouse has children from another relationship the State puts aside some of the intestate estate only for the biological descendants, in case the surviving spouse decides to share the inheritance with what were step-children of the deceased.
If the deceased has no descendents, but is survived by a spouse and at least on parent, then the surviving spouse receives the first 25% of the intestate estate, but not less than $50,000.00 nor more than $200,000.00, plus three-quarters of any balance of the intestate estate. The surviving parents equally share the remainder.
If the deceased has a surviving spouse and descendents, all of whom are also the descendants of the surviving spouse, but the surviving spouse has his or her own descendants that are not the descendants of the deceased (step children), then the surviving spouse receives the first 25% of the intestate estate, but not less than $50,000.00 nor more than $200,000.00, plus one-half of the balance of the intestate estate. The remainder passes to the deceased’s descendants.
If one or more of the deceased’s surviving descendants is not the descendant of the surviving spouse (the surviving spouse is the step-mom or dad), the surviving spouse receives the first 25% of the intestate estate, but not less than $50,000.00 nor more than $200,000.00, plus one-half of the balance of the intestate estate. The remainder passes to the decedent’s descendants.
If there is no surviving spouse, then the entire intestate estate passes to the decedent’s descendants.
If there is neither surviving spouse nor descendants, then the intestate estate passes to the parents equally if alive or to the surviving parent.
If there is no surviving spouse, descendants or parents then the intestate estate passes to the descendants of the decedent’s parents.
If there is no surviving spouse, descendants, parents or descendants of parents, but the decedent is survived by one or more grandparents, one-half of the intestate estate passes to the decedent’s paternal grandparents equally if both survive, or to the surviving paternal grandparent, or to the descendants of the decedent’s paternal grandparents or either of them if both are deceased, the descendants taking by representation; and the other half passes to the decedent’s maternal relatives in the same manner; but if there is no surviving grandparent, or descendant of a grandparent on either the paternal or the maternal side, the entire estate passes to the decedent’s relatives on the other side in the same manner as the half.
If there is no surviving spouse, descendants, parents, descendant of a parent, or surviving grandparent, but the decedent is survived by one or more descendants of grandparents, the descendants take equally if they are all of the same degree of kinship to the decedent, but if of unequal degree those of more remote degree take by representation.
If there is no surviving spouse, descendants, parents, descendant of a parent, grandparent or descendants of grandparents, then the decedent’s stepchildren or their descendants take by representation.