During your retirement, you may wish to spend half of the year in one state, and the other half of the year in another state. However, you must choose one state as your legal residence. This is typically the state in which you have the right to vote. It is the laws of that state that will govern your estate planning. If you are in possession of considerable assets, it would be to your advantage to determine which state has be most advantageous tax coverage and which state would be most beneficial to die in.
It is advisable to check the estate tax laws of the state to which you are thinking of moving. Several states impose an estate tax or an inheritance tax upon the demise of their affluent residents. Along with tax considerations, you should choose a residence where you eventually would like to receive long-term care. The states differ with respect to government programs that offer coverage for long-term care.
Florida, which attracts many northern residents, is a frequent destination for “snowbirds,” who wish to escape the cold temperatures and the snow during the winter months. Although Florida does not have an estate tax, it imposes other taxes upon the death of its residents.
While you may have ownership interests, pay real estate taxes, possess bank accounts, register cars and purchase insurance in each state, you are a resident of only one state, and a visitor to the other state.
If you own property in different states, your heirs may be required to engage in the probate process after your death in more than one state. Establishing a trust and structuring the trust so that it owns the real estate may facilitate the transfer of property following your demise. In addition, it is recommended that snowbirds think about executing a durable power of attorney for each state. Thus, if they require legal or financial decisions to be made by another person, the documents are already in place.
It would be wise to consult an estate planning attorney who is versed in the laws of each state in which you own property. The attorney can assess your situation, and decide whether you require separate documents that are specific to each state or if a single document that adheres to the laws of each state is sufficient.