Many people mistakenly assume that, if they die without a Will, all of their assets are taken by the government. Although seizing a person’s assets may be a great way for the government to raise revenue, unless a person owes the government money, the government will not step in and seize a person’s assets when they die. Instead, the assets owned by a person who dies without a Will are distributed to family members in accordance with the intestacy statutes.

Every state has an intestacy statute which dictates how a person’s estate will be distributed. Although the statute does not take into consideration special relationships, family disputes or charitable intent, it does provide a scheme for distributing a person’s assets to his spouse, children, parents siblings and/or other family members. For example, in New York, if a person is married with children at the time of his death, certain exempt property automatically passes to his spouse and minor children. After all legitimate debts are paid, his surviving spouse receives assets valued at $50,000, plus ½ of the rest of the decedent’s estate. The remaining ½ is divided equally between the decedent’s children. Even if the decedent was estranged from his wife or would have wanted one child to receive more than another, the intestacy statute controls.

If the decedent does not have any children, his spouse receives his entire estate. Similarly, if the decedent does not have a spouse but has children, his entire estate is divided equally between his children. If a person has neither a spouse nor children at the time of his death, his estate will pass to his parents, and if they are not living, to his siblings or nieces and nephews. More distant relatives like cousins are the beneficiaries of the estate when none of the relatives named above survive the decedent. Since the statute provides for distribution to somewhat remote relatives, the chances of assets not being claimed are minimal.

Although the intestacy statute dictates how a person’s assets are to be distributed to his family, family members cannot simply close the decedent’s bank accounts or sell off his assets and divide up the money. Rather, court intervention is generally required. The procedure by which someone is named to administer the estate of someone who dies intestate is called an administration proceeding. It is commenced when a petition seeking Letters of Administration (Letters) is filed with the Surrogate’s Court in the county where the decedent was living at the time of his death. The petition is generally filed by the person who wants to be the administrator of the estate and provides information about the decedent, his assets and his family. Depending on who survived the decedent, the court may require an affidavit stating whether the decedent was ever married, whether he had children and whether individuals who are listed in the intestacy statute are still living. The affidavit must come from someone who does not stand to inherit anything from the estate. Notice of the administration proceeding must be sent to everyone entitled to share in the decedent’s estate. If no one comes forth with objections, and the person seeking Letters is qualified, the Surrogate will sign an order directing that Letters be issued. Depending on the relationship between the administrator and the decedent, and the size of the estate, the administrator may be required to post a bond.

Once Letters are issued, the administrator has the authority to marshal and distribute the decedent’s assets. However, as mentioned above, the administrator does not have any discretion with respect to how the assets are distributed. This is one of the main reasons why it is important to have a Will. In the administration process, as opposed to the probate process, family dynamics and relationships are trumped by the intestacy statute that does not take into consideration the wishes of the decedent.

This article first appeared in December 2, 2010 issue of the Times Beacon Newspapers.
Linda M. Toga of The Law Offices of Linda M. Toga, P.C. is an East Setauket, New York attorney with a general law practice focusing on estate planning, real estate, marital planning, small business services and litigation.