We live in California - My husband and I each own 50% of all our LLC's - without a will or partnership agreement, what happens to his/her 50% if one of us suddenly dies?
Does the 50% go to the surviving partner?
Can children from a first marriage claim rights to the 50% of the deceased partner?
Without a will, won't the surviving spouse automatically inherit all marital properties?
When someone dies "intestate", without a will, state law determines who inherits the property. It gets a bit complicated in California because it is a community property state so the issue of who inherits what, for a married decedent, comes down to whether the asset is community property or separate property. In your specific case, you probably want to get some advice from a competent California attorney.
The easy fix here of course it to have wills prepared so that the asset go where you want rather than where the California state legislature dictates.
answered 27 Oct '10, 17:10
Passing without a will is called being INTESTATE.
The laws of inheritance for a particular jurisdiction govern how property passes when the decedent is intestate. The rules for community property states, like California, also come into play.
I found a site at http://www.mystatewill.com/statutes/ca_law.htm that discusses what happens in an intestate probate estate in California and how the rules apply. You should note that this isn't necessarily the State of California's site and what's posted may not be the law, but someone else's interpretation of the law. The specific titling of the asset also comes into play.
Titling always has an impact on what happens. For example, if my will says my $1M bank account is to be divided equally between my two children when I die, but when I die my girlfriend and I hold that account as joint tenants with rights of survivorship, SHE gets it and my kids miss out.
On the other hand, if we hold it as Joint Tenants in Common, when I die she could get half (as a joint owner) and the remainder would go to my heirs. Its also important to know what's assumed if the title is not clearly stated.
On the other hand, if I die intestate and we held the account as joint tenants in common, then she gets half and the other half gets dealt with under the state's intestacy laws. This could result in the money winding up with the Board of Education if I have no debts or legal heirs.
There are other quirks with the intestacy laws which vary depending on whether you're married, whether you have minor or adult children, whether your parents or grandparents are alive and whether you have siblings who are still alive.
Just remember, if you fail to plan the state will gladly impose THEIR plan on you.
answered 28 Oct '10, 18:16