You may own property and pay real estate taxes in both states, have bank accounts in both states, register cars in both states, buy insurance in both states but you really only live in one state and you are visiting the other state.
Scenario: you head north when temperatures start to rise to escape the heat of Summer, and then you migrate back south for the Winter months. Your homes are in two different states, and all is well …until it comes to your estate planning. Living in several states may not only subject you to the hassles of multiple state income tax filing, but it can be even trickier when it comes to your estate planning.
This issue was explored by Boston CBS in an article titled “How To Protect Your Estate While Living In Two States.”
Living in two or more states might result in planning your estate two or more times. It seems everything has to pass muster to each state (or country, if you’re that much more worldly). This is especially true for rather fundamental legal instruments like your general power of attorney or medical directive. The requirements for these legal instruments oftentimes vary from one jurisdiction to another.
A good rule of thumb is to have your legal instruments prepared in your state of legal residency (i.e., where you are registered to vote, have your primary mailing address, register your automobiles, etc.) and then have them reviewed by an attorney in any other state where you also spent part of the year. It may be cheap legal “insurance” to have separate documents for use in each respective state, just to be on the safe side.
It is better to know the legal enforceability of your legal instruments before a crisis, and they need to be made available to their appropriate jurisdictions, and perhaps tailored to the local law. Then again, when it comes to assets you might not want to straddle a fence so you might have to choose a state to live and own your assets in; the trouble and the necessary planning come into play when you can’t or don’t want to move away entirely from what might be a family home or a new life in a warmer climate.
Do you live in more than one state? Have you planned accordingly to protect ALL of your assets? You can learn more about this topic as well as other strategies on our website under the tab entitled: estate planning in Williamsburg, Virginia. Be sure you also sign up for our complimentary e-newsletter so that you may be informed of all the latest issues that could affect you, your loved ones and your estate planning.
Reference: CBS Boston (October 19, 2012) “How To Protect Your Estate While Living In Two States”