If you created a Last Will and Testament as a single individual, being married can impact previous decisions made in your will. There are certain laws regarding spouses that can change the terms of your estate plan.
Some states, known as “community property states,” require certain portions of a person's estate to be given to their spouse upon death. Even if the spouse is specifically excluded from the person's will, there are some requirements that still must be met. Some of these include 401K accounts, pension accounts, and some IRAs.
You still have some control over your estate and how it is distributed upon your death to an extent. This is the primary reason for creating a will. You need to be aware of some inheritance laws that offer a level of protection to the surviving spouse.
The inheritance rights of spouses come down to your particular state of residence, whether it’s a “community property state” or a “common law state.”
Community Property States:
A community property state rules all assets and property gained during the marriage are considered owned by both spouses. If you purchased property or earned money before you were married, those assets are considered as your belongings only. However, if you purchase a home or open a financial account during your marriage, your spouse is entitled to half that asset.
Many people may only consider community property laws in relation to divorce proceedings, but these laws also affect inheritances.
In the other 41 common law states, assets or property gained in a marriage are not automatically considered belonging to both spouses. You can purchase a home and only list yourself as the owner on the deed. Even if you are married, your spouse does not automatically own any part of that property.
A divorce decree automatically severs your former spouse’s rights to your estate in most states. The dissolution of the marriage automatically terminates that spouse’s claim to your estate.
It would still be wise to update your Last Will and Testament and make the necessary changes regarding your beneficiaries and your estate. If you are in the middle of divorce proceedings that have not been finalized, you can create an “interim will” to serve as a placeholder until the other legal matter is completed.
Even if your spouse is not a US citizen, they can still receive assets and property through your will. Non-citizens, however, are not exempt from the Federal Estate & Gift Tax (applied to inherited assets over $5.45 million). Financial gifts between spouses who are both US citizens are exempt from this tax, which includes any assets received as an inheritance.
You and your spouse may be considering the idea of a joint will instead of two individual documents. There are pros and cons to this option, and ultimately, the final decision has to do with your preference.
The most common “con” for a joint will is it can quickly become long and complicated. It may not allow each spouse to address their individual wishes and instructions in the proper way. The most common “pro” for the joint will is the simplification of choosing beneficiaries and dividing the joint estate.