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Estate planning concerns if you live in two states

On Behalf of | Apr 12, 2024 | Estate planning

Arizona has become one of the more popular destinations for retired adults. There are many snowbirds in Arizona who spend the colder seasons in Arizona and the remainder of the year in the state where they lived and worked previously. There are also people who work seasonally in one state and then later in another state.

Those who divide their time between two states have numerous practical issues that they may need to address. Practical concerns for those living in more than one state include significant legal differences depending on where they live. Retired adults are among those who may make estate planning a priority. Those who regularly travel for work may also worry about protecting themselves and their loved ones.

Those who relocate may need to revise their existing estate plans to better ensure that they are accurate, as should those preparing to retire. Whether someone has to create their first estate plan or update an existing one, they need to know about certain unique issues that affect those living in two states.

Residency effect jurisdiction

Someone living in two states typically has to choose one location to serve as their primary residence. Even in cases where people evenly split their time between two locations, one address is their permanent residence. Whether someone chooses to set their permanent residence in Arizona or elsewhere can have a major impact on estate planning needs. The taxes and probate rules that may apply are different from one location to the next. A testator may need to have two sets of advance directives to ensure they have compliant paperwork in both states where they reside.

Cross-state estate administration can be a challenge

When a testator owns property in more than one state, that creates significant practical challenges for the personal representative administering their estate. People may need to carefully consider who they select as their personal representative based on where that person lives and where the testator holds their most valuable asset. Their personal representative may need legal or practical support in both states to properly secure assets and address estate administration issues. The representative may need help communicating with probate court officials and tax authorities in both states.

Establishing an estate plan that reflects someone’s unique needs, like their practice of living in two states, is important for their long-term protection. Adults who create customized escape plans often derive more benefit from their efforts than those who use basic, boilerplate documents.