Do Trust Laws Vary by State? What to Know When You Move

Moving—it’s a rite of passage that most of us experience at least once in our lives, and it’s a journey filled with a myriad of emotions. Picture this: Sarah, a vibrant young professional, was embarking on her own moving adventure. She had outgrown her cozy starter home in sunny California and was ready to settle into a spacious family residence with her husband and two children in the picturesque hills of Tennessee. Their new home, nestled in a charming suburb just outside Nashville, promised a fresh start and exciting opportunities. The move had been prompted by her husband’s dream job offer in the country music industry, an opportunity they couldn’t pass up. Sarah was thrilled to be closer to her extended family, who had always lived in this welcoming southern state. As she stood on the threshold of this exciting transition, she couldn’t help but feel a mixture of excitement and anxiety. Adjusting to life in Tennessee was like stepping into a different world. The streets bore unfamiliar names, the local eateries beckoned with tantalizing menus of Southern Comfort Food, and friendly neighbors with distinct accents awaited introductions. Sarah found herself immersed in the culture of her new community, eager to make friends and create lasting memories in this vibrant environment. Amidst the whirlwind of packing up their belongings into the moving van and bidding a bittersweet farewell to their old cul-de-sac in California, Sarah and her husband suddenly realized that they had overlooked an essential aspect of their life journey: the status of their trust. They had established a trust several years ago, thinking it would provide lasting protection for their assets. However, as they settled into their new state of Tennessee, they discovered that the laws governing trusts were markedly different from those in California. Sarah’s inquisitive nature led her to explore this topic further, and she soon realized the importance of ensuring that their estate plan was in sync with the laws of their new state. Sarah’s story serves as a poignant reminder that while moving can be an exciting adventure, it’s essential to consider the legal aspects of your estate plan when transitioning to a new state. With the right knowledge and expert guidance, you can ensure that your family’s financial future remains secure, regardless of where life’s journey takes you.

Why Do Trust Laws Vary By State?

When you move to a different state, you have also moved to a different situs. A situs is where your new home is located in terms of legal jurisdiction and taxation. Moving your primary residence to a different state means you will be taxed by a different government and living under the laws of that state.  Because each state has the right to create their own laws under the 10th amendment, trust laws change from state to state—within reason. Making sure your estate plan is compliant with your new state’s laws will save your family from haggling with probate courts if something isn’t quite right. 

How to Update Your Estate Plan for State Laws

When you move to a new state, you’ll want a legal expert from that state to look at your will or trust. If you have a will, it will be equally valid from state to state, but wills are generally not protected from probate laws. It’s almost always better to have a trust instead of a will—a trust gives you much more freedom for how and when you use it. 

Trusts

In most cases, trusts of all kinds will need to be updated when you move to a new state. This is also a great opportunity to review your current trust and make sure that all the right assets are included and that the right people are set up to receive your assets upon your death. For example, you may have new children or grandchildren you want to include in your trust, but haven’t updated it in many years. This is the perfect time to do so! 

Property

Another important thing to consider is that you will have a new home and new property that need to be included in your trust. You might also own a new business that needs to be attended to in your estate planning process. Forgetting to make these updates can lead to major issues with your family’s security after you pass away. Any possessions and other assets that are not included in your trust will be subject to probate, which in many states can take months.

Pour-Over Wills

One of the best additional items that you need to be sure you consider creating when you are estate planning is a pour-over will. This document will ensure that any items that are not called out in your estate planning and your trust will be included automatically in the trust. This helps  prevent months of struggle with probate courts to get possession of the assets that you have left behind. This can also help to eliminate family tension and conflict over the estate dispersal process.

Key Estate Planning Considerations

Some estate planning variables change from state to state. These considerations need to be looked into when you bring your trust to be examined by an expert. The right expert team of legal professionals should be aware of the various considerations that can vary by state, but being educated about these various factors can help prevent issues with your trust.

Marital Property Rules

Marriage can have different property rules associated with it in different states. You will want to set up your trust to take these rules into consideration. For some states, marital property is always divided 50-50, while for others it is divided based on equity.

Executor

The executor of your will or trust might not change over time, but it can be easy to forget to update the person who is listed for this job. Make sure that you are thinking about any changes that you want to make to this important part of your will and trust if you move. Your executor does not have to live in the same state as you, but it should be someone you trust and who is recommended by a legal expert. 

Power of Attorney

In some states, you need to have a power of attorney on file for medical decisions and other considerations that need to be made during your final days. Take time to look at who you’ve selected as power of attorney and make sure your paperwork is in order. 

Moving to A New State? Get Your Estate in Order!

Any time that you make a move to a new state, have a legal expert look at your estate. This is an essential process to make sure that your estate is still correct and legally binding in your new home. Assuming that your will and your estate will hold up in your new state of residence can be a big mistake. If you need help with your estate review, give Legacy Law Group a call. We have years of experience with estate planning, and our team can help guide your estate review process properly. We will make sure that your estate complies with Tennessee law so that you can be sure your loved ones will be taken care of. Contact us today for a complimentary discovery call!