DEFINITION of 'Last Will And Testament'
A last will and testament is a legal document that communicates a person's final wishes pertaining to possessions and dependents. A person's last will and testament outlines what to do with possessions, whether he is leaving them to another person or group or donating them to charity, and what happens to other things for which he is responsible, such as custody of dependents and accounts and interests management.
BREAKING DOWN 'Last Will And Testament'
A person writes a will while he is alive, and its instructions are carried out once the individual passes away. The will names a still-living person as the executor of the estate. That person is responsible for administering the estate. The probate court usually supervises the executor to ensure that he carries out wishes specified in the will.
A will and last testament forms the foundation of an estate plan and is the key instrument used to ensure that the estate is settled in the manner desired. While there can be more to an estate plan than just a will, it is the presiding document the probate court uses to guide the process of settling an estate. Any assets not already designated by beneficiary, such as a life insurance policy or a qualified retirement plan, are not included as probate assets and pass directly to the beneficiaries.
Specifically, a will and last testament instructs the court in the disposition of all assets, including who is to receive them and in what amount. It establishes guardian arrangements for surviving dependents, and it accounts for any special circumstances, which may include the care of a special-needs child or an aging parent. Addenda to the will, such as power of attorney or a medical directive, can direct the court on how to handle matters if a person becomes physically or mentally incapacitated.
Consequences of No Will
When a person dies without a valid will, he dies intestate, which means the state becomes the executor of the estate. In settling the estate, the state decides how to distribute the property and who receives payment first, without any consideration for a family’s circumstances. Any blood relative can stake a claim to the estate. The court can even establish guardianship arrangements based on its determination as to the best interests of the children. If a court determine a will is improperly drafted, it deems it invalid. Settlement of the estate is then subject to the state's intestate law.