Protecting the Snowbird Estate

Many seniors do not think about how living in two states after retirement may impact their estate plans. A recent article discusses several ways that seniors who live in two states can protect their estate and ensure that their wishes will be carried out should they become incapacitated or pass away.

Seniors must be sure that they understand which location is their legal domicile. A legal domicile is the location considered to be a person’s permanent residence, where they have a drivers license and maintain a home. It is important to be clear which state is your legal domicile because the laws of that state will dictate how your estate will be distributed. This can be tricky, however, if you split your time and property between two states.

If seniors own property in two states, their heirs may have to endure the probate process for both. In order to avoid this, seniors should consider creating a trust and transferring ownership of property to the trust. This way, the property will pass directly to the heirs rather than being held up in probate.

It is also important to execute a Durable Power of Attorney and Advanced Medical Directive for both states. These documents help ensure that if seniors become incapacitated, their legal and financial decisions will be made in accordance with their wishes.

We get a number of clients who have real property (homes) in two different states, especially cases where establishing residency in one of those states (not New Jersey or New York) makes better planning sense. The steps to making a good case are logical, and you should follow as many of them as you can. We created a guide for clients that we hand out at signings when this issue presents itself. Remember, the point isn’t to prove to Florida, for instance, that you live there — since they don’t care too much about it — it’s to make sure that the other state (NJ or NY) can’t pull you back in to that state when you aren’t legally there.