Tuesday, December 4, 2018
President George H.W. Bush, the 41st President of the United States, passed away earlier this week. His death occurred a mere 8 months after his wife of 73 years, Barbara, died. While it may appear to be a romantic ending to their decades long relationship, the short time between their deaths can raise issues for their beneficiaries and make the estates' administrations more difficult.
“The statistics are high especially for older couples who had close marriages, dependent on each other,” says Paula Leibovitz Goodwin, partner in the Personal Planning Group at Perkins Coie LLP in San Francisco. While the quick succession of spouses' deaths is quite common, the time between can be critical as some survivorship provisions may require that a spouse survive for a specific amount of time. If the timing is close, for example less than two weeks apart, the two estates may be able to be probated contemporaneously.
This type of provision would not have benefited the Bushes. Reading the documents of both of the spouses carefully is vital to determine exactly how the assets would flow. “Does the estate pass from 1st spouse who died to survivor, and then from survivor to others, or does 1st spouse’s assets pass to their next level beneficiaries and surviving spouse’s assets pass to their next level beneficiaries?" Goodwin says.
With certain accounts, the other spouse is named beneficiary and others as contingent beneficiaries. If death occurs in quick succession, the second spouse to die likely had not yet rolled the first’s retirement account into their own account with beneficiaries. This would cause the retirement account to pass to probate with the first spouse's estate.
See Megan Gorman, Valuable Estate Lessons from the Passing of George and Barbara Bush, Forbes, December 3, 2018.
Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.) for bringing this article to my attention.