Many blended families and families with adopted children face unfortunate (even shocking) consequences when a family member dies without an estate plan. This article discusses unique issues applicable to these families:
In the absence of a will or trust, a state’s intestacy laws control how someone’s property is divided upon his or her death. Different states have starkly different laws. In Illinois, for example, if one spouse dies without a will, the estate is divided 50/50 between a surviving spouse and the deceased’s descendants (755 ILCS 5/2-1). In Florida, in the same situation, if all descendants are descendants of both spouses, the spouse takes 100% of the estate, with nothing going to the children (Florida Statute Section 732.102). These are vastly different consequences for the same situation (50% to the descendants in Illinois; 0% in Florida), and every state’s law is different. Further, state law could change at any time, meaning you cannot count on these intestacy rules applying to you at the time of your death.
For these and other reasons, relying on state intestacy law is a bad plan for any family. Relying on state intestacy law is an especially bad plan for blended families or families with adopted children. During my estate planning time as an Air Force JAG, I assisted a lot of these families. With the young family population in the military and the frequency of moves, it was very common to see a family where a husband and wife were raising children from each other’s prior marriages. Often, the parents in the blended family would either formally adopt their stepchildren or treat them as their own. These blended family arrangements could create very difficult situations if state intestacy law comes into play.
The Illinois Supreme Court recently heard a case where a stepfather raised his stepson from a very early age. The stepfather treated the child as his son, called himself his “father”, provided for his son throughout his childhood, and told his son he had been legally adopted. Under Illinois law, an adopted child in this situation has the same intestate succession rights as a natural born child. However, after the father died, no records could be found to show a legal adoption had actually occurred. This left the child in an awful predicament, apparently unable to assert his rights as an heir under Illinois law. Ultimately, the Illinois Supreme Court decided to recognize the family’s arrangement as an “Equitable Adoption”, granting the child the rights of a legally adopted child. But not all states agree with this interpretation of the law. And if your family has to go to court and hire lawyers to argue for years over who in your family is really your child, does anyone win?