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When a person dies without a will, it is called being "intestate." Their estate will be distributed according to their state's unique laws of intestacy. These laws control:
States typically follow distribution laws that are:
Your state's specific rules can be found in your state's probate code (sometimes, this has a different name). How the estate is distributed determines the actual share that each heir inherits.
In per stirpes, the estate is divided into equal shares for each of your kids. Let's use the example of an estate having $10,000 to pass on. The person who passed away is called the "decedent," and is named Jon. Jon had four kids named Robb, Kat, Ed, and Jaime. However, Jaime passed away years ago. This means:
The first division of the estate always occurs at the level of the decedent's children (four children in our example.) This happens regardless of whether any of the children survive the decedent.
If this is not the way you want your estate handled, it is important to speak to an estate planning attorney and have your wishes documented.
In per capita, the estate divides into equal shares for the nearest generation of descendants that has a member living at the time of the decedent's death. This means all of a decedent's kids are equal, and if one child passed away, their living kids are also equal.
Let's go back to the example above. The decedent, Jon, still has $10,000 in their estate to pass on. This means:
Per capita means your kids and grandkids could all inherit equal shares of your estate if one of your children passes away before you. So, unlike in a per stirpes system, the initial distribution in per capita depends on the heirs surviving the decedent. Per stirpes will make your children equal when they inherit no matter if they are living or deceased.
If you prefer one approach or the other, or this is not how you want your estate handled in the future, you must speak to an attorney to understand your state's laws and choose how your property is split.
This article is intended to be helpful and informative. But even common legal matters can become complex and stressful. A qualified estate planning lawyer can address your particular legal needs, explain the law, and represent you in court. Take the first step now and contact a local estate planning attorney to discuss your specific legal situation.