A Northwest State of Mind

Last month, I attended the Washington State Bar Association Real Property, Probate and Trust Section’s annual mid-year conference and continuing legal education seminar. Not only did it provide an opportunity to connect with colleagues from around the state, I also attended several educational sessions on topics related to our estate planning and probate practice areas.

One of the more interesting sessions (to me anyway) addressed the differences between how probate is handled in Washington, Oregon and Idaho. Why would probate be different depending on where you live – or where your property is located – when you die? Probate, the process governing the disposition of a person’s property after death, is controlled by state law. This makes some sense, considering that a state is rightly concerned about the transfer of property within its borders.

One difference in estate administration among states in the Northwest is the amount of a person’s assets exempt from estate tax. While the federal estate tax (sometimes called the death tax) is well known, it affects only those relatively few estates with more than $5.49 million in assets in 2017. Washington, Oregon and Idaho all differ on how they impose taxes on estates. For example, Washington imposes its estate tax on assets in estates valued at more than $2,129,000 in 2017. Meanwhile, Oregon exempts just the first $1 million in estates from its tax. Idaho has no estate tax at present.

The Northwest states also differ in how they handle the probate process. Washington provides for the administration of estates without court intervention in certain circumstances, known as a nonintervention probate. Idaho has a similar, but not identical, law that provides for “informal probate”. Oregon, however, generally requires more court intervention in the probate process.

When state borders are easily breezed through on the highway, and it is not uncommon for families to own property in multiple states, it can be easy to forget that there can be significant differences in the administration of your estate after you die based on where you live and where you own property. While I would never advocate relocating to a different state solely based on the probate process or potential estate tax, you absolutely should work with an attorney where you live to make sure your estate plan makes sense for the state you are in.

Photo credit: Sherry Bosse Lueders