An estimated 68% of Americans have no will in place. Though it’s difficult to think about a time in our lives when we might not be around for our loved ones, it’s something we should all do to ensure our assets are distributed according to our wishes.

Without a will in place, your assets will be distributed according to your state’s inheritance law. There are three main laws in place across the United States, which we’ll look at in this article.

Understanding Inheritance Law

Inheritance laws determine how an individual’s assets are distributed upon their death. They come into play in the event a will was not written or if a will does not mention all assets. This said, in some instances, inheritance laws also provide individuals excluded from a will with the right to claim an inheritance.

Inheritance laws mostly pertain to the partner of the deceased individual. However, in some instances, they also pertain to the children of the deceased. For example, most states have a law protecting against accidental disinheritance; when a will is written before a child is born and isn’t revised before their parent’s death.

As we mentioned in the introduction, there are three main inheritance laws you need to know about. You should also know which inheritance law governs the state you reside in. These laws are:

• Community property
• Common law
• Elective community property

We’ll look at each.

Community Property

Under this inheritance law, each spouse owns half of what they both earned while married. When one spouse dies, half the estate, therefore, goes to their partner. The other half of the estate can be distributed.

If you have a will in place, the deceased can choose to leave more than half of their estate to their spouse. There are 9 states under the community property inheritance law:

• Arizona
• California
• Louisiana
• Idaho
• Texas
• Washington
• Wisconsin
• New Mexico
• Nevada

Common Law

38 states use common law inheritance. This law states spouses are not automatically entitled to half the assets throughout the marriage, though they can claim for this.

This law also allows the surviving spouse to petition for more of the estate, regardless of the terms of the deceased’s will. They can do this by petitioning the court. However, other beneficiaries can also petition the court for a larger share of the estate.

Elective Community Property

There are three states which don’t quite follow the above two inheritance laws. These are Alaska, Kentucky, and Tennessee.

For Alaska, the state adopted the elective community property law in the late 1990s. The state still functions under common law, but if there is a will or a community property trust in place, the surviving spouse has an automatic right to the inheritance.

Tennessee has a similar law, adopted in 2010. While Kentucky only adopted an elective community property law in 2020.

Another legal aspect you should be aware of that can affect your inheritance is a modified endowment contract (MEC). You can learn more about MECs at paradigmlife.net/blog/understanding-modified-endowment-contract-mec/.

More Finance and Insurance Advice

Inheritance laws are dependent on the state you live in. The best way to prepare for them is by consulting with an estate attorney and creating a will. This will help ensure that all your beneficiaries get a fair share.

You can find more legal and insurance advice on our site, so make sure to take a look.