The inheritance laws and disputes associated with it are of great importance not as a branch of law which is extremely practical in essence, but as a set procedure that would once be followed by each individual. No need to say that everyone has relatives, parents, friends, spouses, etc. and at least for once all people inherit. Therefore, the importance of one's awareness about the key aspects of inheritance law is hard to be overwhelmed. Despite the fact that at first glance its provisions seem to be rather simple and clear, it is the sphere where the majority of disputes arise. Therefore, it would be of great benefit to find out more about the history of inheritance laws, the taxation, and the individuals who have a right to inherit before turning to the main aspects of the inheritance disputes.
History of Inheritance Laws in the USA
There is no doubt that people always die and therefore, the laws governing inheritance are truly immortal. They have been widely known at the beginning of civilization. The inheritance laws of the USA are mainly based on legal concepts that have prevailed in Great Britain. Nowadays, it consists of different legal acts of various force: the Acts of Parliament, the common law, by-laws, etc. (Hirsh 2009). The importance of these rules is unquestionable. On the one hand, they set a procedure according to which the property of the deceased individual is distributed after his/her death. On the other hand, it introduces the terms that regulate the relations between generations. A quick overview of the inherence laws of the USA might provide certain suggestions of the nature of the USA current laws that regulate various inheritance relations.
The first settlers who arrived at the territory of North America brought with themselves the rules of inheritance that were borrowed from Great Britain. Of course, they were not willing to abandon the system that was known to them. However, having realized the social conditions of those times, they started to implement some of the indigenous elements into their own culture. Some of the concepts have even survived till nowadays (Hirsh 2009). One innovation that was brought in by settlers was even of great benefit as it helped to make the jurisdiction of courts clearer and easier for understanding. Prior to 1857, the jurisdiction over disputes resulting from inheritance was divided between church and common law courts in Great Britain. Whereas the former claimed to have the right to hear the cases related to the disposal of personal property, the latter considered that they had every right to decide on the cases related to the real property of the deceased. Due to the little impact of church in the new colonies, all the inheritance disputes were heard solely by one tribunal. The matters concerning probate were left for the consideration of the courts of general jurisdiction. It should be also noted that even in those distant times the states started to distinguish in terms of inheritance regulations. For example, the state of Pennsylvania adopted the laws according to which the cases related to orphans' matters were heard by the specialized courts solely.
It should be also noted that the freedom of testation was established long before it was introduced in Great Britain. From the very beginning, both, the girls and boys, were entitled to inherit property of their deceased relatives (Hirsh 2009). Additionally, strong differences between American inheritance laws and those of Great Britain might be drawn while comparing intestacy procedures. Intestacy is a set of rules which are applied when there is no will of deceased (Hirsh 2009). The laws of Great Britain provided that the land was to be inherited by the older son. The colonists had abolished this rule in favor of equality of genders and established that all children had the right to inherit. Later on, various states also experimented with the right to inherit by the spouse who had outlived another spouse. For example, in Virginia, the widow was entitled to the part of personal property along with the life estate in reality.
The American Revolution which has significantly impacted the society had obviously brought no significant changes into the inheritance laws. The Colonial Laws were still in force. However, it should be mentioned that the rules providing for the equality of all children in terms of right to inherit had spread in the majority of states. Additionally, the entails were abolished throughout the territory of all states.
During the 19th century, a lot of legislative innovations had been introduced. Almost all American states required the wills to be made in written form and witnessed by others. This rule was applied regardless of the nature of the property that was to be inherited after the death of the individual. However, the main developments of the 19th century refer to the extension of the surviving spouse's rights and to the invention of trust as a specific instrument of estate planning. The surviving spouse was entitled to the shares in the personal as well as real property. The historians explain such a shift by the increased importance of personal property in comparison with the real one in the 19th century. Moreover, in the absence of a will, the positions of the surviving spouse were even stronger.
The 20th century had brought significant changes in social, economic, and cultural patterns of the American society. The states suddenly started to adjust their trust-investment laws to the modern theories (Hirsh 2009). Other aspects of inheritance had been changed similarly. The rules which settled the debates over gender-based distinctions became the essential part of the statutory law. Some of the provisions that were discriminating in nature have almost disappeared in the 20th century. Gender neutrality was the new core principle in the inheritance laws.
Moreover, the will was expected to be executed by the specifically appointed person. The wills, itself, were subjected to strong protection guaranteed by various high-water marks. Moreover, at the turn of the century, the federal estate tax was also levied in the brand new way. At first, it was levied due to the increased needs of national defense. Later on, the movement in favor of the introduction of federal estate tax was supported even by such wealthy titans as Andrew Carnegie. However, the tax was not enacted until the beginning of World War I. The issues related to the levying of the federal estate tax are still heavily debated. In 2001, the Congress adopted the law according to which federal estate tax was about to diminish year after year until its complete abolishment in 2010. However, a year after that this law expired and the rules that applied before 2001 were in effect again. However, the current rules are still disruptive in nature and need to be revised as soon as possible. Still, the Congress' plans regarding these issues remain undetermined.
Tracing the history of inheritance law amendments, it should be noted that legislators seem to be extremely passive when it goes about setting or revising existing inheritance rules (Hirsh 2009). Therefore, estates and trusts suffer from the old problems that have not been resolved until nowadays. The judges have to apply the statutes that were issued two hundred years ago. Of course, some of them are outdated or even contradict the modern tendencies (Hirsh 2009).
Inheritance Laws in Other States: General Overview
The inheritance laws in the USA are strongly influenced by the concept of federalism as every state is entitled to adopt its own legal regulations regarding inheritance issues. Just as in any other country, these laws specify the circle of people who have the right to inherit after the deceased. Needless to say that just as in other countries, in case there are no heirs, the property of the deceased individual becomes a public property.
Despite the fact that there have been numerous attempts to regulate the inheritance issues at the federal level, so far it is fully competence of the states. Therefore, the clearance of the laws as well as their correspondence to the canons of common law might vary from state to state. For example, New York is considered to have the most complicated procedures set for the distribution of the assets of the deceased while Ohio has introduced comprehensive laws and by-laws which significantly differ from the common law rules and leave no room for any kind of ambiguity or non-clearance. The Washington state has followed the example of Ohio and has codified the inheritance laws as well. However, it should be noted that inheritance disputes which arise in relation to the Native Americans are subjected to the federal regulation.
In Europe, the inheritance laws are strongly impacted by the regulations and resolutions of the European Union which change the inheritance laws of the national states while coming into effect. For example, in 2015 new regulations are expected to come into effect providing that the individual will have a right to choose the laws that will apply to the inheritance procedures. He/She might choose either in favor of the laws that exist in the country of his nationality or in the place of his habitual residence.
Secondly, the majority of the European countries have based its inheritance laws upon the Ancient Roman laws and the Civil Codes of Napoleon. Therefore, at large one could simply draw the similarities in both substantial and procedural rules governing the inheritance issues. For example, according to the German laws, the property of the deceased located within German territory will be subjected to the so-called 'universal succession' which means that the heirs of the decedent could inherit the property only after his/her death (Kobras 2010). The whole procedure of succession depends on the will of the deceased individual. If he/she has disposed of his/her property during his life, then the rules of intestacy will not apply (German Missions in the United States n.d.). Contrary to the United States and other Anglo-American countries which have provided that there must be the administrator of the estate of deceased whose responsibility is the legitimate distribution of the property that is to be inherited, no kinds of executors or trustees of estate are mentioned in German laws (Kobras 2010).
The Australian inheritance laws have been different for a long period of time in each territory or state. However, the situation changed in 2011, when this country started to revise the current laws and introduce the uniform regulations for all states and territories (Kobras 2010).
As have been already mentioned, the history of the inheritance taxes is long and complicated. It was introduced due to various reasons that changed over time. This tax was also frequently identified as estate tax. Following all of it, it seems important to give a glance at this type of taxes before transferring directly to the inheritance disputes.
The concept of inheritance tax supposes that it is a certain fee that is to be paid by the person who inherits the property of deceased individual. This tax is a federal one which is obligatory for all citizens of the USA regardless of the state they live in. Lately, the provisions regulating the levying of the inheritance tax have been revised. Thus, nowadays only eight states charge the fee from the inhering individual (Leach 2011). They include Iowa, Indians, Tennessee, New Jersey, Pennsylvania, Nebraska, Indiana, and Maryland. Needless to say that the laws are revised over time so that it is recommended for the heirs to look them up in case they are inheriting some property. The tax rate varies from state to state and ranges from 1 percent till 20 of the value of all assets that are inherited. However, there are a lot of people who are exempted from paying it.
Contrary to the federal estate tax, the person who benefits is in charge of paying that fee, not the estate. The estate tax is paid before the distribution of the deceased person assets. Its amount depends upon the value of the property that is later inherited. However, it should be noted that this tax could be levied only if the value of the property overwhelms certain rate that is set every year. Since this threshold is rather high, only two or three percent of taxpayers are subjected to this taxation (Leach 2011).
Inheritance taxation occurs right after the distribution of the estate that is usually performed by the distributor. This tax is calculated out of the share that has been received by each beneficiary separately. It is important to note that the redemption or the reduction of the tax that is to be paid depends upon the relationships that existed between the deceased and his/her heir. Therefore, a surviving spouse, for example, might be exempted from the tax duty in some states. It is interesting to point out that the children and other people who have heavily depended on the deceased could be exempted from the tax paying fully or partially. The general rule in this regard is that the more distant the relationships are, the more heirs have to pay.
There is a number of individuals who are entitled to inherit after one's death. However, the key attention is always drawn to the surviving spouse and children of the deceased. At this point, it is important to distinguish the succession in case the will is present and in case it is absent (intestacy). If the deceased has disposed of his/her property during his/her life, then all his/her assets are distributed according to his/her last will. It should be noted that the will of the person could be easily changed if the need arises. The last will overrules the previous ones. Despite the fact that the person has a natural right to dispose of the property after death, there are still some individuals who will inherit regardless of them being mentioned in the will. This rule generally applies to those who severely depended on the deceased or those who was in close relations with him/her when death occurred. It might include the surviving spouse, children, some relatives, etc. The volume of share they receive varies from state to state. Usually, it is half of the share that they would get in case of intestacy.
If there is no will, then the rules of the intestacy are applicable. They set a clear procedure that is to be followed. Usually, there are four or five lines of inheritance. The first one, for example, includes the closest relatives. In fact, in the majority of states, the surviving spouse could not be completely out of the will (Thorne n.d.). Additionally, in almost all states the spouses are presumed to own their property together and therefore, in case one of them dies, another one gets the half of all property that has been earned by the couple during the time they have been married (Thorne n.d.). Thus, the surviving spouse has every right to dispose of this property according to his or her own intentions. Moreover, the states laws guarantee that the spouse who has survived will be granted one third or one half of the share of the deceased person. In any case, the laws of the states prevent the surviving spouses from being disinherited.
As to children, the majority of states in the USA reserve no rights for the children in regard to the inheritance (Thorne n.d.). Despite this, in the exclusive circumstances, the children are entitled to claim the share in the property of the deceased person. Additionally, the laws of several states prevent the cases of disinheritance. It means that if the person has disposed of his/her property in the will before the birth of further children, after his/her death the children who were born later have the right to inherit. The same provisions might apply to the grandchildren of the child who died.