If you don’t have a Will when you die, you die “intestate”, the opposite of “testate” meaning dying with a Will. Virginia statutes essentially write your Will if you don’t have one.
Many types of assets pass to your beneficiaries outside of probate, whether you have a Will or not. Examples of these types of assets are retirement accounts and life insurance contracts that pass directly to your named beneficiaries. If there are no named beneficiaries, then the plan or contract determines who receives the benefits, often a spouse, children, or your Estate. Payable on Death and Transfer on Death Accounts also avoid probate and go directly to the person named. Joint bank accounts become the property of the joint account holder, and real estate held jointly with survivorship also transfers automatically to the surviving owner.
Other assets that do not pass directly at your death become probate assets. Real estate held solely in your name, bank accounts, cash, business interests, stocks, mutual funds, tangible personal property and even your pets are probate assets. In Virginia, a statute dictates who will inherit these assets.
- Your surviving spouse inherits everything unless you have a child that is not also your spouse’s child.
- If you have a spouse and children with another person, your spouse will inherit 1/3 and your children will split 2/3 (including any children you have with your spouse and children that you have with another person)
- If you are not married, your estate goes to your children, and if any of your children are deceased, their children inherit their share (and so on)
- If you have no direct descendants, and your parents are alive, your parents inherit.
- If your parents are deceased, your siblings inherit.
- If you also don’t have siblings, then your estate is split between relatives on each of your parents’ sides.
- If no family can be found, your Estate goes to the Commonwealth of Virginia.
If you don’t have a Will, real estate passes directly to your heirs. If your debts exceed your personal (non-real estate) assets, then the Administrator of your Estate can petition the court to sell the real estate to raise funds to pay your debts.
If you don’t have a Will, a statute also determines who may handle your personal Estate. In the first 30 days, either a sole distributee, or any one or more distributees with the consent of all distributees, may qualify. After 30 days, the Probate Clerk will appoint the first distributee to apply, but if more than one distributee applies, and they cannot agree, then a court hearing will be needed to determine who will qualify. Often, when inheriting family members don’t get along, a neutral third party ends up being appointed that all parties can agree on to handle things impartially.
The person that is appointed will gather your personal property, determine your debts, pay your creditors, file your final taxes, file an inventory and accounting(s) with the Commissioner of Accounts, an attorney appointed by the court to review probate filings, and then ultimately distribute what’s left in accordance with the statute.
Effect of Dying Without a Will on Your Minor Children
In the event of one parent’s death, the child’s other parent continues as legal guardian. However, if you do not name a guardian in a Will, and both parents have died, the court will select a guardian for that child. If your child is age 14 or older, he or she can nominate a guardian of his choice, and the clerk can appoint that person as guardian if they are appropriate.
If your minor child inherits from your estate, the clerk will also appoint a guardian of the child’s estate to hold those funds for your child until your child turns 18. At 18, your child will receive these funds outright. The guardian of your child’s estate will also hold any life insurance funds, retirement benefits, etc., if your child is named directly as a beneficiary. The guardian will have to post a secured bond and report annually to the Commissioner of Accounts.
If your minor child inherits real estate, the guardian of his estate or other interested person will need to file a petition with the court in the event that they wish to sell the real estate.
Why Having a Will or Trust is Better
If you have a Will or Trust, you can choose who inherits and who handles your estate. For your minor children, you can choose who is their guardian and create trusts for them to manage their money as long as you’d like, well past 18.