Probate Through Intestacy: How it Works and Why You Should Avoid It

By Robert L. Loftin

What happens if someone dies without a will? It is a scenario that many families face, but one governed specifically by Alabama law.

With no guidancefrom the deceased person on how they would want their assets distributed, family members are hamstrung by Alabama law. This is called “intestacy,” and this is how the law seeks distribute assets “fairly.” The policy goal of the intestacy process is to move the transfer of property to heirs with the least amount of bias.

This “will for all the people,” however, can lead to thorny legal issues, hurt feelings and long-lasting family feuds.

Understanding Alabama’s Intestacy Schema

In Alabama, the probate court has jurisdiction over all estates, whether they are created under a will, or whether there is no will. In the case of the intestate estate, the court appoints an administrator. This can be a family member (surviving spouse, for example), or in some cases, the court appoints a county administrator – this is a lawyer who administers estates for those dying without a will.

After the administrator is appointed, and all debts, taxes, asset liquidation costs and other related expenses are accounted for, the remainder of the estate is distributed under a statutory framework, which was passed by the state legislature.

The Surviving Spouse’ Share of the Estate

• If neither of the decedent’s parents are alive, and there are no children, grandchildren or other lineal descendants, then the surviving spouse receives the entire estate.
• If one or both parents are living and there are no children/other lineal descendants, then the surviving spouse receives the first $100,000 and half of the remainder.
• If there are surviving children and both the decedent and the surviving spouse are the parents, the surviving spouse receives the first $50,000 and then half of the remainder.
• If there are surviving children but one or more of them is not the child of the surviving spouse, then the spouse gets an even half of the estate.

The Surviving Children’s Share of the Estate

• If all the decedent’s children are alive, then portion of the estate which left after the surviving spouse receives their share is distributed among them in equal shares.
• If one or more children dies before the decedent, and that child had children, then their children (the decedent’s grandchildren) inherit their deceased parent’s share, and it is divided among those grandchildren equally.
• Children of the half-blood are treated the same as children of the whole blood, as long as their natural parent was the decedent.

The Rest of the Family

• If all the decedent’s children are alive, then portion of the estate which is left after the surviving spouse receives their share is distributed among them in equal shares.
• If the decedent has no surviving spouse and no surviving children/lineal descendants, then their surviving parents receive the entire estate.
• If there is no surviving spouse, no surviving children/lineal descendants or surviving parents, then the estate goes “laterally” – to the decedent’s brothers and sisters and then nieces and nephews.Even surviving grandparents are potentially eligible for intestate distributions.

Here is an example of intestacy in action: Let’s assume that Wanda dies without a will but with $1 million in assets. She is survived by her father Fred, her husband Harry (second marriage), two children by her first marriage (Arthur and Brutus) and a child (David) by her marriage to Harry. Wanda also had a child – Charles – by her first marriage, who predeceased, her. Charles had two children… After paying funeral costs, paying debts and expenses, there is $840,000 remaining in the estate.

Under intestacy, Harry will receive one-half of the estate, or $420,000. The balance of the estate will be divided into four equal shares of $105,000. Arthur, Brutus and David will each receive $105,000, and Charles’ two children will split his share equally ($52,500 each). Wanda’s father will not receive a share.

Addressing the challenges of intestacy.

While Alabama’s distribution scheme may seem simple, confusion prevails when there are children from multiple partners. Things can, and often do, get ugly. Consider:

• In counties that do not use a county administrator, the court typically appoints the surviving spouse to serve as administrator of the intestate estate. If there is no surviving spouse, then any “next of kin” entitled to a share of the estate can be appointed. In this case, which heir does the court select? The appointment process is now open to disputes and the resulting bitterness lurking over the process.
• Protecting the interests of a minor childrenbecome complicated when there is no will in place to provide what will happen until the child reaches majority age, which is 19 in Alabama. The court must appoint a guardian and conservator to represent the child. That person is chargedwith exploring the options available to best manage the inherited share and to ensure meddling family members manipulatedecisions counter to the child’s best interests. Whowill serve as guardian? A family member? An attorney? This is a critical ruling.
• Intestacy can also ignite family resentments. Wait, he did nothing for her, and she gets the same amount I do? The conflict can rise to the level of litigation, which sometimes grows nasty and lingers for years.
• What if a child of the decedent has been financially helped more than the other children? Maybe the deceased parent gave a child $20,000 to put toward down payment on a house purchase. Does that mean the court should consider this as an advancement of that child’s share and shave $20,000 from that child’s share? Family disputes over advancements are so common that Alabama devotes almost a third of its law on intestacy to this.

The moral hereis that if intestacy can be avoided, it should. Plan your estate now. Take an inventory of your assets, spell out your wishes and contingencies, and leave as little of your estate exposed to intestacyas possible.This will help eliminate confusion and uncertainty—and unnecessary potential family disagreements.

Need an attorney to help you plan your estate? Contact Wallace Jordan today.