Wills aren't one-and-done deals. In fact, it's common for people to update their wills more than once. After all, a life event — or even a change of mind — can alter who you want to name as beneficiaries. However, we usually recommend reviewing your will every ten years. Below are four circumstances that require you to act promptly and update your will.
Revisions vs. Codicils
First, a clarification. You may be familiar with the term "codicil." This is a legal document that's treated as a supplement to an existing will and may suffice if you're making a minor change. If your attorney adds a codicil, you don't have to alter the original will, and when your will is subjected to probate, so is the codicil.
Codicils, however, are less common today, now that it's easy to replace a will by simply editing a digital file. And the existence of codicils can create confusion relating to other parts of the will. It's often more convenient for everyone in the family to rely on a single document — a revised will.
Either way, your codicil or revised will must be handled with the same legal formalities (including signature witnesses) as the original will. (See the sidebar, "What to Include In a Codicil.") Therefore, it's best to have any will documents prepared by a qualified attorney.
When to Take Action
What situations may trigger a need for an update of a will through a codicil or revision? These are generally the most common:
Births, deaths, marriage or remarriage. Maybe you didn't have any children or grandchildren when your will was initially drafted. If you do now, you may want the newest members of the family to share in your estate. Or perhaps family members you previously named in your will have passed away. You'll want to remove their names from your list of beneficiaries and possibly include other family members who weren't previously named in your will. A new marriage is another reason to revise a will.
New executor. In some cases, you may have to select a new executor (or guardian or trustee). This may occur if the one you named in your will has died or become incapacitated and you haven't made adequate contingency plans. In other instances, you may simply prefer to assign the job to someone else.
Revalidation. Suppose a witness who can verify the signature on your will is no longer alive or can't be located. When it's required, a codicil attested to by new witnesses can revalidate a will.
Tax law changes. A new or revised tax law may require you to modify certain provisions to take maximum advantage of the latest rules. In addition, there's uncertainty concerning the future of the federal gift and estate tax exemption ($12.06 million in 2022 and increasing to $12.92 in 2023). It's scheduled to revert to its pre-2018 level of $5 million (plus inflation indexing) after 2025, unless Congress takes action. Other estate tax law changes are also being contemplated by some members of Congress.
Reasons specific to you may also indicate a will revision — for example, if you become estranged from a family member or a beneficiary acquires significant wealth and you don't feel he or she needs additional assets from you. But be sure to discuss such issues with your estate planning advisors.
Above and Beyond Your Will
Many people find they require more than a will (even a revised one) to achieve their estate objectives. For example, you may want to name beneficiaries to assets that pass outside your will (such as retirement accounts) or set up one or more trusts to avoid probate and help minimize current taxes. Contact us to discuss your estate options.
What to Include in a Codicil
If you choose to change your will with a codicil, it must have identifying information. This includes:
Your full legal name,Address,Date of the codicil, andA statement indicating that you're of sound mind and not being coerced by anyone.
Your attorney will explain what parts of the will are affected. Use full legal names when referring to beneficiaries, specify dollar amounts or percentages, and describe any property in detail.
Also, the codicil should state that its provisions supersede what you've written in your will and that all parts of the will not affected by the codicil remain in effect. You'll need to sign the codicil and have it witnessed according to state law. Finally, as with all estate documents, store it in a secure location with your original will.
The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.