The Swier Law Firm Estate Planning and Probate Law FAQs

Yes. In South Dakota, if you have children, you are not required to leave them any portion of your estate. A common misunderstanding is that you must leave each child at least one dollar. Today, you may simply state, “I have intentionally failed to provide for my son, James.”

No. In South Dakota, married persons may not completely disinherit their surviving spouse, unless the spouse agrees. While it is true that you may dispose of your property in almost any way you wish through your will, there are some restrictions. Depending on how your will provides for your surviving spouse, the surviving spouse may choose to take an “elective share” in lieu of the provision made in the will. The amount of this “elective share” is determined by the length of the marriage.  

 

No.  Under these circumstances, the State of South Dakota will usually not take your property. However, if you don’t make a will, the State of South Dakota will decide who takes your property. If you die without a will and your relatives cannot be found, then the State of South Dakota may get your property.

In South Dakota, you and your husband can make a joint will. However, our law firm does not recommend doing this. One of the great advantages of making your own will is that you can change it as often as want. Your circumstances may change over the years. Tax laws may also change. You may outlive your husband by five years or fifty years. Therefore, you and your husband should each have a separate will.

A Power of Attorney (Financial) is a document that you, as the “principal,” create by appointing another person, the financial “agent” or “attorney in fact,” to make financial decisions for you should you become incapable of making them yourself. It is important to note that your “agent” or “attorney in fact” does not need to be a licensed lawyer. You can name anyone to serve in this role.    

In South Dakota, a Power of Attorney for Health Care is a document that you, as the “principal,” create by appointing another person, the health care “agent” or “attorney in fact,” to make health care decisions for you should you become incapable of making them yourself. This type of power of attorney is “durable” because it is effective even if you become incapacitated. It is important to note that your “agent” or “attorney in fact” does not need to be a licensed lawyer. In fact, you can name anyone to serve in this role.    

If you obtained real estate in South Dakota during your marriage, your property is most likely owned as a joint tenancy with the right of survivorship. Under a joint tenancy with the right of survivorship, each owner effectively owns the whole asset. In other words, each owner shares ownership equally. If one owner dies, the other owner acquires the deceased owner’s interest automatically.

If you own real estate in South Dakota with someone other than your spouse, you usually have a tenancy in common. Under a tenancy in common, each owner holds his share of the asset outright. Under this ownership structure, there is no need for there to be “equality.” For example, you might own 60%, and your brother would then own 40%. If your brother dies, his interest in the property will  be distributed in accordance with the directions in his will. In other words, your brother’s interest does not pass automatically to you as the remaining tenant in common.

Title to property is equivalent to ownership. If property is titled only in your name, you are the sole owner. If the property is titled in more than one name, it is jointly-owned property. In South Dakota, the most common types of jointly-owned property are joint tenancy with the right of survivorship and tenancy in common.

Here’s an example of how a trust could work: Presume that your will leaves everything to your spouse. In the event that your spouse dies before you do, your will leaves everything to your five minor children. Because your five children are minors, the state circuit court will need to appoint a guardian to manage your children’s finances. Under South Dakota law, the guardian may be required to file a financial accounting with the state circuit court. Sometimes, the guardian must get the state circuit court’s permission to spend money for the children. Perhaps most alarming is that as soon as your minor child turns eighteen, the child receives his estate share outright. Of course, most eighteen year-olds are not mature enough to handle this kind of major financial responsibility.

A trust, however, allows you to designate whether or not the trustee must post a bond or file accountings with the state circuit court. You can also grant the trustee discretion as to how to spend or invest the trust assets and designate the age that the trustee can provide the property to your children. For example, you might postpone distribution until at least age thirty, or sometimes half at age thirty and half at forty. In other words, your trustee can make sure that the funds are used sensibly, such as to pay for a child’s college education, before your trustee has to turn the property over to the child.

For young families in South Dakota, an important benefit of having an estate plan is that you can name the person you want to serve as the guardian of your minor children. For the parents, this is often the most difficult estate planning decision to make. The guardian is the person you designate to raise your minor children until their eighteenth birthdays. South Dakota courts will normally follow your guardianship wishes.  

An estate plan also allows you to establish a trust and name a trustee. A trust is a legal arrangement that divides ownership of property into two parts: legal ownership and beneficial ownership. The trustee is the person who holds the legal ownership of the property. The trustee controls and manages your property according to your instructions for the benefit of your beneficiaries, who hold the beneficial title to the same property.