If the client dies without any estate plan, the person is known to have died intestate. If the person dies with an estate plan, the person died testate. Dying intestate can lead to some unintended consequences. For example, under most states law, if a person dies intestate with a spouse and children, the surviving spouse receives 1/2 of the person’s property while the children divide the remaining 1/2 of the property. This result occurs even if the children are minors resulting in guardianships being required for each child. In addition, the intestate laws do not make any provision for friends, distant relatives, trusted employees, churches or charities. An estate plan allows the client to direct exactly where his or her property is to go at death. It also allows for assets to pass to minors without the need for any guardianship.

In many instances, the client has made lifetime gifts to one or more heirs. The intestate laws do not consider these lifetime gifts when dividing the decedent’s property where an estate plan can take these gifts into account. Also, the intestate laws do not provide who will receive specific pieces of personal property leaving the heirs to agree upon the division, if possible. An estate plan can specify who will receive each piece of personal property preventing disputes among heirs. If the decedent owns a business, the intestate laws may result in the business being sold. An estate plan can prevent the business from being sold.

The cost of administering an intestate estate is usually much greater than administering a testate estate. The intestate laws contain procedural requirements which can be very expensive and time consuming. In addition, intestacy will usually result in much larger estate taxes being due upon the death of the client. In most cases, estate planning will reduce or even eliminate estate taxes.