An Alabama court recently unsealed American novelist Harper Lee’s will after The New York Times filed a lawsuit to review the document.
Lee, who was 89 when she died in 2016, set up a living trust in 2011. Author of the Pulitzer Prize-winning novel, “To Kill A Mockingbird,” Lee directed that her estate – including her literary property – be transferred into her trust via a pour-over will, the NYT reported.
A trust is private, so by using a pour-over will, the notoriously private Lee ensured that what happens to her assets will remain closed, too. “To Kill A Mockingbird” earns about $3 million a year in royalties, and her novel, “Go Set A Watchman ,” sold 1.6 million hardcover copies when it was published in 2015, meaning that the trust is likely worth tens of millions of dollars.
If you have significant assets, the use of a revocable or living trust and a pour-over will are a way to ensure that your personal estate assets become part of the trust estate upon your death.
A pour-over will is especially useful if assets are wide and varied, and by transferring those properties into a trust, it ensures that they will be distributed according to the trust provisions.
Assets might not make it into a trust before death for a variety of reasons. They might be acquired after the trust is set up, such as a painting or property. Sometimes, items are left out of a trust by mistake – or even left out intentionally. Or, items such as a car or boat could fail to be titled to the trust, meaning that they will be looked at as personal property.
Without a pour-over will – assuming there is no simple will that distributes property to individuals – your heirs will inherit according to specific state law. This means that someone not named in your trust may inherit assets in a way that you never intended.
Using a pour-over will can help simplify things. Because the assets are transferred into the trust, everything is controlled by one document, and your executor or trustee has an easier time distributing assets.
One disadvantage to a pour-over will is true for a simple will as well: Most pour-over wills that transfer assets must go through probate. Depending on how long probate takes – weeks, months – the process can put your assets in limbo while waiting for the case to be resolved, leaving your beneficiaries in a holding pattern.
Leaving too many assets in the pour-over will can complicate and draw out proceedings, so you and your heirs are better off if nearly all of your assets are transferred into the trust.
Despite these small issues, when you establish a trust and a pour-over will, you will protect your assets for the long haul.