Six months south and six months north could be a great lifestyle in retirement but one place will need to be your legal domicile, your legal residence. And it’s the laws of that state which will dictate your estate planning. You will need to decide which state would be advantageous to die in.
You might live across more than a few borders in your life. After all, it’s often as easy as passing the “Now Entering …” sign over the highway or remembering the second zip code. Unfortunately, living in several states may not only subject you to the hassles of multiple state income tax filing, but it can be even trickier when it comes to your estate planning.
This issue was explored by Boston CBS in an article titled “How To Protect Your Estate While Living In Two States.”
Living in two or more states might result in planning your estate two or more times. It seems everything has to pass muster to each state (or country, if you’re that much more worldly). This is especially true for rather fundamental legal instruments like your general power of attorney or medical directive. The requirements for these legal instruments oftentimes vary from one jurisdiction to another.
A good rule of thumb is to have your legal instruments prepared in your state of legal residency (i.e., where you are registered to vote, have your primary mailing address, register your automobiles, etc.) and then have them reviewed by an attorney in any other state where you also spend part of the year. It may be cheap legal “insurance” to have separate documents for use in each respective state, just to be on the safe side.
It is better to know the legal enforceability of your legal instruments before a crisis, and they need to be made available to their appropriate jurisdictions, and perhaps tailored to the local law. Then again, when it comes to assets you might not want to straddle a fence so you might have to choose a state to live and own your assets in; the trouble and the necessary planning come into play when you can’t or don’t want to move away entirely from what might be a family home or a new life in a warmer climate.
So what boundaries do you live across, and what assets are of the utmost importance to save?Reference: CBS Boston (October 19, 2012) “How To Protect Your Estate While Living In Two States”