Why do I need a Will?
If you die without a valid Will in Georgia, then the rules of intestacy apply. This means that your heirs are determined by law according to their relationship with you. Furthermore, if you do not have a Will and your heirs at law do not come forward, your estate may escheat (be given) to the state. The reasons for drafting and executing a valid Will vary depending on an individual’s situation.
For those with young children, probably the most important reasons to have a Will is to direct who will take custody of your children if you die before they reach adulthood. Another important reason to have a Will as a parent, is to ensure that your financial assets are transferred to properly provide for your children and spouse. For example, if a married person with two toddler-aged children dies with $900,000 and no Will, only $300,000 will go to the surviving spouse, and $300,000 will go to each toddler. Someone, presumably the surviving spouse, would have to pay legal fees, plus a significant cost to get a bond, in order to be named conservator of the toddlers’ money. The conservator must abide by strict rules and is supervised by the court. Then when the toddlers reach age 18, they will receive all of the money remaining, along with the right to sue the conservator for money wasted, converted, or mismanaged. Most people would rather their spouse inherit everything, and do not want their children to have full access to large sums of money until they have reached a more mature age, such as age 30.
For small business owners, there are a myriad of issues that can arise. One of the most common issues is when a parent has only one of several children involved in the family business. The parent might wish for the child involved in the business to inherit and continue running the business. Doing so, however, would create a huge inheritance for one child, while leaving the other children with virtually nothing. Proper planning is especially important for owners of privately held businesses.
For those with a significant net worth, their estates may be subject to estate taxes and generation skipping transfer taxes, all due within 9 months of the date of death. The estate tax bill might force the sale of a privately held business or large real estate holding. A forced sale often sells for a huge discount because it must be sold quickly and perhaps in a down market; additionally, the family may desire to hold a particular business or piece of real estate regardless of the sale price. These taxes can be minimized with proper estate planning techniques, and liquidity to pay the tax can also be planned for, often through proper life insurance planning. [O.C.G.A. §§ 53-2-1; 53-2-51]