When deciding between a will or trust in Connecticut or making other estate planning decisions in this state, it is important to understand the key differences between these two primary different estate planning tools and the general rules regarding estate documents.
Wills: Conn. Statutes, Chapter 802a (Conn. Gen. Stat §§45a-250, et. seq.).
Trusts: Conn. Statutes, Chapter 802c (Conn. Gen. Stat §§45a-471, et. seq., including Conn. Uniform Trust Code, Conn. Gen. Stat. §§45a-499a, et. seq.).
Connecticut Will Requirements.
To execute a valid will in Connecticut, a testator must be at least 18 years of age and of sound mind. A Connecticut will must be in writing, signed by the testator, and attested by two witnesses. Witnesses must sign the will while in the testator’s presence.
Though it is generally preferable for a will’s witnesses to have no interest in the testator’s estate, a Connecticut will is not rendered invalid solely because a witness has an interest in the will. However, a devise in favor of a witness to the will (or the spouse of a witness) is void unless there are two other witnesses or the interested witness is also the testator’s legal heir (i.e., someone who would be a beneficiary of the estate if the testator had been intestate).
Connecticut law does not specifically require wills to be notarized, but Connecticut wills can be made “self-proved” through execution of a notarized affidavit by the will’s witnesses. The affidavit may be executed at the request of the testator or later at the request of the will’s executor. The affidavit can be included within the will itself or attached as an exhibit. The purpose of the affidavit is to set forth the facts to which witnesses would need to testify for the will to be admitted in probate—such as that the testator was mentally competent and not under any duress or compulsion when executing the will.
Connecticut probate courts are required to hold a hearing before a will is accepted or rejected in probate unless all parties with an interest in the estate sign a written waiver. The court may also determine that notice is unnecessary due to, for example, the estate having insufficient assets to pay administration costs, funeral expenses, and final health bills.
Amendment, Revision, and Revocation of Connecticut Wills.
Connecticut wills can be amended through execution of a codicil, which is a written addendum and supplement to an existing will. A codicil must comply with all formalities required for execution of a will. Alternatively, a will can be revised by executing a new will that supersedes the previously executed will.
Under Connecticut law, a will can be revoked through “burning, cancelling, tearing or obliterating” the document by the testator (or by someone else acting at the testator’s direction while in the testator’s presence). Connecticut wills can also be revoked through execution of a subsequent will.
If a testator marries after executing a will in Connecticut, the surviving spouse receives a share of the testator’s estate as if the testator had died without a will—unless the omission appears from the will to have been intentional or the testator provided for the spouse through non-probate transfers intended in lieu of devises in the will.
If, after executing a will, a child is born to or adopted by the testator and the child is not provided for under the will, the after-born child is entitled to an interest in the estate. If the testator had no other living children, the after-born child’s share is measured as if the testator had died without a will—unless the will devises substantially all of the estate to the child’s other parent. If the testator already had children, an after-born child’s share is based upon the devises to the testator’s other children. An omitted after-born child’s share is inapplicable if the omission appears to have been intentional or the testator made other arrangements to provide for the child outside the will.
If, after executing a will or revocable trust, a testator is divorced, any provisions in the will or trust in favor of the former spouse are deemed to have been revoked—unless the will expressly provides otherwise.
Holographic and Oral Wills.
Neither holographic (handwritten) nor oral (nuncupative) wills are recognized under Connecticut law. A will written by hand, signed by the testator and two witnesses, and which otherwise satisfies the legal requirements for a Connecticut will is valid.
Connecticut Trust Requirements.
Connecticut’s statutory framework for trusts is embodied in Chapter 802c of the Connecticut General Statutes. The Connecticut Uniform Trust Code, which applies the uniform approach used in many other states with a few modifications, is included within Chapter 802c. Connecticut trust law allows trusts to be created for any lawful reason not contrary to public policy.
To create a valid Connecticut trust, the settlor must indicate an intention to create the trust and must have sufficient legal capacity to do so. Though most trusts are evidenced by a written instrument setting forth the trust’s terms, Connecticut law recognizes oral trusts—provided the creation and terms of the oral trust can be established by clear and convincing evidence.
Connecticut trusts must have at least one identifiable beneficiary (subject to a few exceptions like charitable trusts and trusts for the care of animals) and a trustee with actual duties to perform. The trustee has a fiduciary duty and must administer a trust in good faith, prudently, consistently with the trust’s purposes and settlor’s intentions, and in the best interests of the beneficiaries.
A Connecticut trust takes effect when the settlor transfers title to property (either during life or through a will or other disposition effective upon death) to a trustee for a beneficiary’s benefit; upon the grantor’s declaration that he or she holds identifiable property as a trustee; through a power of appointment in favor of a trustee; or through a statute, judgment, or court order requiring administration of property through a trust.
Connecticut trusts are assumed to be revocable unless a trust instrument expressly declares the trust to be irrevocable. Revocable trusts may be revoked or amended by the settlor either using the method stated in the trust instrument or, if no method is specified, through a method that provides clear and convincing evidence of the settlor’s intent to revoke or amend the trust.
Termination of a Connecticut trust can occur through revocation or expiration under the trust’s own terms, when no purpose of the trust remains to be achieved, when administration becomes uneconomical, or when the trust’s purpose becomes unlawful, contrary to public policy, or impossible. Connecticut law also provides procedures by which parties to a trust can modify, amend, or terminate the trust by petitioning a court for approval. Court-approved modifications can include changes to correct mistakes or to assist in achieving the settlor’s tax objectives.
Connecticut recognizes a variety of specialized types of trusts, including trusts for the care of animals, spendthrift trusts, and charitable trusts—which must serve a charitable purpose (e.g., relief of poverty, advancement of education or religion, or promotion of civic or health-related purposes beneficial to the community). Dynasty trusts, which are designed to protect wealth over multiple generations, can extend for as long as 800 years under Connecticut law.
Connecticut recently revised its trust statutes to authorize domestic asset protection trusts (DAPT). A DAPT is a self-settled irrevocable trust that protects assets against most creditor claims even where the settlor is also beneficiary.
Estate Taxes: Though Connecticut does not impose an inheritance tax, it is among the dozen states that charge estate taxes to wealthy estates. The exemption amount (the minimum value before an estate qualifies for the tax) is scheduled to gradually increase year-by-year from $5.1 million in 2020 to $7.1 million in 2021, $9.1 million in 2022, and an amount equal to the federal threshold in 2023 (the 2021 federal exemption is $11.7 million). The Connecticut tax is a combined estate and gift tax, with bracketed rates from 10.8% to 12%.
Simplified Probate: For small estates (defined as personal property within the probate estate worth no more than $40,000 and no real estate), Connecticut law provides for a simplified settlement process without formal probate. Small estates probate may be commenced by a surviving spouse or child’s submission of the required affidavit to the probate court. If approved, the process allows for speedier payment of claims and transfer of assets without going through the formal probate process.
Full probate procedures may also be dispensed with if the court finds that, after deducting the spousal support allowance, the estate’s assets are insufficient to fully pay costs of administration, final expenses, and federal and state taxes owed by the estate.
Non-Probate Transfers: Along with living trusts, Connecticut law offers multiple other options for transfer of assets outside of probate. POD (payable-on-death) and TOD (transfer-on-death) designations, which provide for automatic transfer of an asset to a beneficiary upon an owner’s death, can be used in Connecticut for a variety of assets. For instance, POD designations can be added to financial accounts and CDs, and TOD designations can be used with assets like registered securities and brokerage accounts.
Similarly, some assets—like retirement accounts and life insurance—allow owners to name a beneficiary who automatically takes ownership of the asset upon the original owner’s death.
Assets co-owned as joint tenants with a right of survivorship automatically transfer to a surviving owner upon the other owner’s death. Connecticut does not recognize tenancy by the entireties, another joint ownership form with a right of survivorship that can only be used for co-ownership by two spouses.
Transfer-on-Death (TOD) Deeds and Vehicle Titles: Connecticut is not among the minority of states that authorize TOD designations on real estate deeds. Connecticut does, however, allow TOD designations on vehicle titles. When a TOD designation is added to a vehicle title during life, ownership of the vehicle automatically transfers to the named beneficiary upon the owner’s death, with no need for probate. The beneficiary does not acquire any present rights over the asset until death actually occurs.
Spousal Shares: To protect against spousal disinheritance, Conn. Gen. State §45a-436(a) provides surviving spouses the right to an elective share in a decedent spouse’s estate. The elective share is measured as a one-third interest, as a life estate, in all assets within the probate estate. A Connecticut spouse’s elective share can be waived through a valid pre- or post-nuptial agreement, and the share is effectively voided if the surviving spouse had abandoned the decedent spouse without adequate cause.
If the surviving and decedent spouses married after the decedent’s execution of the will, the spousal elective share is an alternative to the statutory share afforded to a surviving spouse omitted from a will executed by the decedent spouse prior to the marriage.
If a decedent spouse leaves no will, a surviving spouse’s intestate share depends upon the decedent’s other surviving relations. If the decedent leaves children or grandchildren who are all also the issue of the surviving spouse, the share is $100,000, plus half the remainder. Or, if the decedent leaves issue not also from the surviving spouse, the share is one-half of the estate. If the decedent leaves neither surviving parents nor children, the surviving spouse receives the entire estate.
A Connecticut probate court may also provide for an allowance from the decedent’s estate of an amount the court deems necessary for the decedent’s surviving spouse while the estate is being settled.
Creating a will or trust does not have to be difficult or intimidating. However, certain circumstances—like second marriages, stepchildren, aging parents, special needs beneficiaries, guardianships, and business interests (to name a few)—can add a layer of complexity and result in unforeseen long-term consequences. Whenever any out-of-the-ordinary issues are present, it’s a good idea to consult with an experienced attorney familiar with and licensed under the laws of the relevant jurisdiction.