Louisiana Wills vs. Trusts
Navigating Louisiana estate planning can be daunting. The Pelican State offers unique estate planning challenges due to its civil law system, which differs significantly from the common law used in the other 49 states. With Louisiana’s forced heirship laws, community property system, and strict will formalities, understanding the key differences between wills and trusts can save your family significant time, money, and stress while preserving your legacy according to Louisiana’s distinctive legal framework.
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Louisiana Will Requirements
A Louisiana Last Will and Testament should include:
- Age and Capacity: Testator must have “adequate mental capacity” and be at least 16 years old
- Format: Must be in writing (as a “notarial testament”)
- Signature: Must be dated and signed by the testator on each page and at the end of the document
- Witnesses: Must be signed by two witnesses and a notary, all of whom must include an attestation declaring that all formalities for a valid will have been met
Notarial Testament Forms
Louisiana applies different methods for executing a notarial testament depending on the testator’s status when creating the document:
- The five different forms depend on whether the testator can read, is physically capable of signing, is visually impaired and/or deaf and can or cannot read Braille or understand sign language
Signature Requirements
Witness Requirements
For Louisiana wills:
- Witnesses must be mentally competent, able to see, at least 16 years of age, and able to sign their names
- Witnessing by an interested witness does not invalidate a Louisiana will
- However, a bequest to an interested witness is void—though an interested witness can still inherit an interest up to the amount he or she would have received had the testator died intestate
Attestation Clause
Will Interpretation
Louisiana law interprets wills under their literal terms, and, when a provision’s meaning is ambiguous, the goal is always to give effect to the testator’s intent.
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Amendment, Revision, and Revocation of Louisiana Wills
Revoking a Louisiana Will
A Louisiana testator can revoke a will at any time up until death. Revocation can be accomplished through:
- Physical destruction of the document
- Statement of the intent to revoke a will in a subsequent testamentary document
- A clear revocation in a document signed, dated, and written entirely in the testator’s handwriting
Revoking Individual Provisions
Revocations of individual provisions can be accomplished through:
- A declaration in a subsequent testamentary document
- A later disposition that is incompatible with an earlier provision
- Disposition during life of the property subject to a provision in a will
- A clear revocation written onto the will and signed by the testator
Contradictory Provisions
Automatic Revocation by Divorce
Other Amendments or Modifications
Other than as expressly authorized under the Civil Code, any other amendment or modification to a Louisiana will can only be made through execution of a valid testamentary document.
Holographic and Oral Wills
Holographic (Olographic) Wills
Louisiana law recognizes holographic (referred to as “olographic”) wills. To be a valid holographic will, a document must be:
- Written entirely in the testator’s handwriting
- Dated and signed at the end by the testator
- Must also express the testator’s intent that it be treated as a will
Oral (Nuncupative) Wills
Louisiana law no longer recognizes oral (or “nuncupative”) wills.
Louisiana Trust Requirements
Trust Parties
As with other jurisdictions, Louisiana trusts involve three principal parties:
- The “settlor” is the creator of the trust. In most cases, the settlor is the individual who contributes property to the trust when it is created, though an individual can contribute property to an existing trust without being a settlor
- The “beneficiary” is the person or persons who stand to benefit from the property held in the trust. The identity of a beneficiary of a Louisiana trust must be objectively ascertainable from the trust instrument (unless specifically authorized otherwise by statute)
- The “trustee” is the person who holds legal title to trust property
Trustee Responsibilities
Under Louisiana law, a trustee has a “fiduciary duty” with regard to property held in the trust:
- Trustees have a duty to preserve and maintain trust assets and to manage trust property in conformance with the terms of trusts
- Trustees must act in the beneficiaries’ best interests with regard to the trust and manage assets in accordance with the “prudent investor” standard
- Louisiana law allows trustees to be granted discretion in exercising their powers (e.g., a trustee can be granted discretion with regard to distributions of trust property to beneficiaries)
- Otherwise, trustees must always act consistently with the terms of the trust instrument
Types of Trusts
Louisiana recognizes:
- Living (“inter vivos”) trusts – trusts created during the settlor’s lifetime
- Testamentary trusts – trusts created by will
Louisiana trusts can include any provisions not specifically forbidden by statute or generally “against public policy or good morals.”
Testamentary Trust Requirements
Living Trust Requirements
Living trusts come into existence upon execution of a trust instrument and can only be created by:
- “authentic act” or
- by a signed writing made in the presence of two witnesses and acknowledged by the settlor or by one of the attesting witnesses’ execution of an affidavit
Trust Revocability
Living trusts can be either revocable or irrevocable:
- With revocable trusts, the settlor retains the right to modify or revoke the trust after it is created
- Irrevocable trusts cannot later be modified or revoked by the settlor
- A settlor of a Louisiana trust must specifically reserve the power to modify or revoke the trust for the trust to be treated as a revocable trust
Trust Termination
Louisiana trusts may be terminated at the time or upon specified occurrences set forth in the trust instrument. Under certain limited circumstances, a trustee can petition a court to terminate the trust.
Louisiana law also provides for automatic termination upon the death, or specified numbers of years after the death, of the last beneficiary and/or settlor.
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Special Considerations
Estate Taxes
No State Estate or Inheritance Tax
Louisiana does not impose any estate or inheritance taxes. Large Louisiana estates may still qualify for the federal estate tax.
Simplified Probate
Small Succession Process
The process called “probate” in most states is referred to as “succession” in Louisiana. Louisiana estates with a total value under $125,000 may qualify for the simplified “small succession” process:
- Estates qualify if the decedent was intestate (or died while residing in another state where probate was opened) and the heirs are the decedent’s close relatives
- Qualifying estates can be administered through an affidavit, without the ordinary, more extensive succession process
“Forced Heirs”
Mandatory Inheritance Rights
Under Louisiana law, a “forced heir” is someone a testator cannot legally disinherit absent “just cause” for the disinheritance:
- A testator’s children under 24 years old (or who are mentally or physically incapable of caring for themselves) are forced heirs
- Louisiana’s forced heirship law reserves a certain fraction of a decedent’s estate for forced heirs, with the precise fraction depending on how many forced heirs there are
- The Civil Code includes a list of conduct considered “just cause” for disinheritance of forced heirs, including:
- Physical violence or cruel treatment toward the parent
- The forced heir’s criminal conviction for serious crimes
- If the child is a minor, the child’s marrying without the parent’s consent
Non-Probate Transfers
Though living trusts are an effective means of transferring assets outside probate, Louisiana’s other options for transferring assets outside probate are more limited than most other states:
- Louisiana law does not recognize joint tenancy with a right of survivorship, so co-ownership of assets is generally ineffective for bypassing probate
- Certain accounts with financial institutions (like a checking or savings account with a bank or credit union) can be assigned a POD (payable-on-death) designation
- The designation gives the institution authority to transfer the account proceeds to the beneficiary upon the owner’s death, though POD designations do not necessarily supersede other heirs’ interests in the relevant assets
- Louisiana law does not recognize TOD (transfer-on-death) designations for financial assets like registered securities and brokerage accounts
- Louisiana does recognize beneficiary designations for assets like retirement accounts, life insurance and annuities
- Louisiana does not recognize TOD designations on real estate deeds or vehicle titles
Community Property
Marital Property System
Because Louisiana is one of the nation’s few “community property” states, a married individual’s assets often include a significant amount of marital property jointly owned by the couple:
- Community property includes most assets acquired by either spouse during the marriage, unless obtained via gift or inheritance
- If a decedent spouse is intestate, his or her half-interest in the couple’s community property will be inherited by the other spouse
- However, under Louisiana law, the inherited interest is limited to a “usufructuary,” which is similar to a life estate—the surviving spouse owns and controls the inherited community property for the remainder of his or her life or until he or she remarries
- A surviving spouse of an intestate Louisiana decedent has lower priority for inheritance of the decedent’s separate property compared to most other states
- Spouses can elect to opt out of community property treatment through a valid prenuptial agreement
Marital Portion
Spousal Inheritance Right
The “marital portion” under Louisiana law is similar to the spousal elective share in many other states:
- A surviving spouse can claim the marital portion when the decedent spouse was substantially wealthier than the surviving spouse
- The marital portion is measured as a fraction of the estate, depending on whether the decedent left children and, if so, how many
- The amount is reduced for any other inheritance received from the decedent by the surviving spouse and any payments received on account of the death
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Our estate planning specialists can help you navigate Louisiana’s unique laws and create a personalized strategy.
Wills vs. Trusts: Comparison
| Feature | Wills | Trusts |
|---|---|---|
| When It Takes Effect | After death | Can be immediate (living trust) or after death (testamentary trust) |
| Probate Process | Requires succession (Louisiana’s probate) | Assets in trust avoid succession |
| Privacy | Public record | Generally private |
| Challenges | Can be challenged in court | More difficult to challenge |
| Cost to Create | Generally less expensive | Usually more expensive |
| Ongoing Administration | None until death | May require ongoing management |
| Protection During Incapacity | None (requires separate power of attorney) | Can provide management if grantor becomes incapacitated |
| Louisiana Special Feature | Strict formalities; forced heirship laws | Must expressly be made revocable; not modifiable by all parties’ consent |
Conclusion
Creating a will or trust does not have to be difficult or intimidating for Louisiana residents. However, certain circumstances—like second marriages, stepchildren, aging parents, special needs beneficiaries, guardianships, and business interests—can add complexity and result in unforeseen consequences.
Louisiana’s unique civil law system creates estate planning challenges not found in other states, including forced heirship laws that grant mandatory inheritance rights to certain children, a community property system with usufructuary rights for surviving spouses, and strict formalities for creating valid wills and trusts.
With limited options for non-probate transfers compared to common law states, Louisiana residents may find trusts particularly valuable for avoiding succession proceedings. However, the state does offer a simplified small succession process for estates under $125,000, providing relief for many families.
When any out-of-the-ordinary issues are present, it’s advisable to consult with an experienced attorney familiar with and licensed under Louisiana law to ensure your estate plan takes full advantage of the state’s provisions while avoiding potential pitfalls.
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FAQs: Louisiana Wills and Trusts
Q: How is Louisiana’s estate planning law different from other states?
A: Louisiana is the only state that operates under a civil law system rather than common law, creating significant differences in estate planning. Key distinctions include forced heirship laws (which mandate that certain children must inherit a portion of your estate), strict will formalities (notarial testaments must be signed on each page in the presence of a notary and two witnesses), a community property system with unique usufructuary rights for surviving spouses, and limited options for non-probate transfers compared to other states. These differences make it particularly important to work with professionals familiar with Louisiana’s specific legal framework.
Q: What are the requirements for a valid will in Louisiana?
A: Louisiana recognizes two main types of wills: notarial testaments and holographic (handwritten) wills. A notarial testament must be in writing, dated, signed by the testator on each page and at the end, executed in the presence of a notary and two witnesses, and include specific attestation clauses. Louisiana has five different notarial testament forms depending on the testator’s physical capabilities. Alternatively, an holographic will must be entirely handwritten, dated, and signed by the testator. Louisiana’s will requirements are exceptionally strict—failure to follow all formalities precisely will render the entire document invalid.
Q: What is “forced heirship” in Louisiana?
A: Forced heirship is a unique Louisiana law that guarantees certain heirs (called “forced heirs”) a portion of your estate regardless of what your will states. Currently, forced heirs include children under 24 years old or children of any age who are permanently incapable of caring for themselves due to mental or physical infirmity. The portion reserved for forced heirs (called the “legitime”) varies depending on how many forced heirs exist. You can only disinherit a forced heir for specific “just causes” listed in the Civil Code, such as physical cruelty to the parent or conviction of a serious crime. This law significantly limits your freedom to distribute your estate as you wish.
Q: How does community property work in Louisiana?
A: Louisiana is a community property state, meaning that most assets acquired during marriage (except inheritances and gifts) are considered jointly owned by both spouses, regardless of whose name is on the title. Each spouse owns a one-half interest in all community property. If a spouse dies without a will, their half of the community property is inherited by the surviving spouse, but with a twist unique to Louisiana—the surviving spouse receives only a “usufruct” (similar to a life estate) that terminates upon death or remarriage. This means the surviving spouse has the right to use the property and receive its income, but the underlying ownership (called “naked ownership” in Louisiana) typically passes to the deceased’s children, who gain full ownership when the usufruct ends.
Q: What is the “marital portion” in Louisiana?
A: The marital portion is Louisiana’s equivalent to the spousal elective share found in other states. It allows a surviving spouse to claim a portion of the deceased spouse’s estate if the deceased spouse was substantially wealthier. To qualify, the surviving spouse must have been married to the deceased for over one year and must be in financial need. The marital portion is measured as a fraction of the estate depending on the presence and number of children. The amount is reduced by any inheritance already received from the deceased spouse and any payments received because of the death. This provision helps prevent a financially disadvantaged spouse from being left destitute.
Q: How can I avoid probate (“succession”) in Louisiana?
A: Louisiana offers fewer options for avoiding succession (Louisiana’s term for probate) than other states. Living trusts remain the most effective tool, as assets properly transferred to a trust bypass succession entirely. Louisiana does recognize payable-on-death (POD) designations for some financial accounts and beneficiary designations for life insurance and retirement accounts. However, unlike most states, Louisiana does not recognize joint tenancy with right of survivorship, transfer-on-death (TOD) designations for securities or real estate, or TOD vehicle titles. For small estates under $125,000, Louisiana offers a simplified “small succession” process that allows heirs to claim assets with an affidavit rather than full succession proceedings.
Q: How are trusts treated differently in Louisiana compared to other states?
A: Louisiana trust law contains several important differences from other states. Unlike most states, Louisiana trusts are presumed to be irrevocable unless the settlor specifically reserves the right to revoke. Louisiana does not allow modification or termination of trusts upon consent of all interested parties unless specifically authorized in the trust instrument. Living trusts must be created by “authentic act” or by a signed writing with two witnesses and an acknowledgment. The identity of beneficiaries must be objectively ascertainable from the trust instrument. While Louisiana’s Trust Code is more detailed and rigid than in common law states, trusts remain an effective tool for succession avoidance, incapacity planning, and potentially addressing forced heirship concerns through carefully structured provisions.
