What is a pour-over will?
A pour over will is a mechanism in your will that allows all the property in your will to “pour over” into a trust that you created.1 The property is then distributed to your beneficiaries that you named in your will.2 The pour-over will is designed to ensure that property will not be left out of the trust and makes them assets of the trust at the time of the party’s death.3 Moreover, your pour-over will helps pass assets that were inadvertently excluded.4 For example, if you have a car, a home, and some antiques at the time of your death but you inadvertently left out the antiques in your will, the antiques would pass intestate. However, if you have a pour-over provision in your will, the antiques will be included in the distribution to your designated beneficiaries.
A pour-over will is different from a testamentary trust. A testamentary trust is a trust that originates from a will and is created upon the death of the testator after probate.5 A pour-over will does not create a trust, but a living trust is created separately and probably at the same time your will is written (or even beforehand).6 The two are separate but connected only because the pour-over will pours property into the living trust, which is itself a valid document.7 Just like with wills, certain assets will not be transferable such as property held in joint tenancy, any assets prohibited to pass by state laws, community property, and assets that are part of a retirement plan.8
What are the advantages and disadvantages of a pour-over will?
One of the perks of a pour-over will goes to the executor of the estate. The executor normally has many duties when it comes to administering a will, such as paying for taxes and debts out of the estate.9 The executor in a pour-over will situation only has to transfer the assets to the living trust.10 Another perk stated before is that property you forgot to mention in your will can still be transferred to your beneficiaries. This may also be an attractive option if your beneficiaries are young adults or children.11 Instead of having the property go directly to the children, it will go into a trust where a trustee can manage the assets and prevent overspending.12
A pour-over will is going to have to go through probate.13 Generally, a living trust by itself will avoid probate. Probate may or may not be viewed as a disadvantage. People generally try to avoid probate because it is a court process that results in your debts, taxes, and fees being paid before the rest of your property is distributed to the appropriate beneficiaries. This can be an expensive and long process. The actual cost of making a trust versus simply having a will may make a pour-over will a less attractive option for some.
For more information on pour over wills contact the experienced estate planning lawyers at Ariano & Reppucci.
1 Mary Randolph, Pour-Over Wills, NOLO.COM, http://www.nolo.com/legal-encyclopedia/pour-over-wills.html (last visited Jan. 26, 2015).
3 Pour Over Will Law & Legal Definition, DEFINITIONS.USLEGAL.COM, http://definitions.uslegal.com/p/pour-over-will/ (last visited Jan. 28, 2015).
4 Michelle Fabio, Top Three Benefits Of A Living Trust, LEGALZOOM.COM (Mar. 2009), https://www.legalzoom.com/articles/top-three-benefits-of-a-living-trust.
5 Pour-Over Will, LAW.FREEADVICE.COM, http://law.freeadvice.com/estate_planning/wills/pour-over-wills.htm (last visited Jan. 28, 2015).
8 Kourosh Akhbari, Pour-Over Wills, LEGALMATCH.COM, http://www.legalmatch.com/law-library/article/pour-over-wills.html (last visited Jan. 28, 2015).
9 Mary Randolph, supra note 1.
11 Kourosh Akhbari, supra note 8.
13 Michelle Fabio, supra note 4.