What assets are not disposed of by a will in Utah?

There are numerous assets that cannot be disposed of by will. The types of assets include: (1) any property held as joint tenants; (2) Totten trusts; (3) property that will be passed to a specific person at the testator’s death pursuant to a contract; and (4) retirement plan benefits, among others.

Joint tenancy can be created in property when one or more individuals share an interest in the property with “a right of survivorship.” Under a joint tenancy, all of the individuals share equal rights to the property while alive. With a joint tenancy, however, any one of the individual’s that have an interest in the property cannot devise their interest to the property through a will provision. Instead, upon the individual’s death, the individual’s interest in the property will be divided among the remaining joint tenants. If there are only two joint tenants, then upon the death of one of the tenants, the property will pass to entirely to the other tenant automatically.

For example, when an account is created jointly during the testator’s lifetime, it will be presumed that the account was a joint tenancy and the testator’s interest in the account will then be divided among any remaining tenants. This presumption, however, can be rebutted if a person seeking to claim an interest in the account can prove that the parties did not intend to create a joint tenancy when the account was created.[1] The most often accepted rationale is that the account was created for convenience, and not created to establish a joint tenancy. For example, if Mary decides to take over the care of her elderly sister, Emily, Emily may add Mary to her account so that it is more convenient for Mary to purchase items that Emily needs using Emily’s account. If the person can prove that there was in fact no joint tenancy, then the property will pass according to the testator’s wishes as expressed in a validly executed will, or will pass according to the intestacy laws of Utah.

A Totten trust is a bank account that is held in the testator’s name “in trust for” a specified beneficiary. During the testator’s life, he has exclusive ownership of the trust. When the testator dies, the account will then automatically go to the named beneficiary. Any will provision that attempts to pass this trust to a person other than the originally named beneficiary will be held invalid.

During the testator’s life, he can create a contract that specifies how certain property should pass at his death. Any property that is the subject of one of these contracts cannot be passed by a will. The most common example of this type of property includes life insurance proceeds. The testator, during his life, created a contract with the insurance company that a specific amount of money will pass to a named beneficiary upon the testator’s death. The testator cannot change the beneficiary of any life insurance proceeds through a will provision. Retirement plan benefits are also treated in a similar fashion and can only pass to the designated beneficiary.

[1] Utah Code § 75-6-104

Michael Hepworth

Michael Hepworth

Managing Attorney at Hepworth & Associates
Michael is the Managing Attorney of Hepworth & Associates, LLC.
Michael Hepworth

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