Published in the Portsmouth Herald (1/28/2021)
Clients moving to New Hampshire frequently ask whether the estate plan (collectively a will, health care advance directive, financial power of attorney, and a trust) created in their former state of residence is valid in New Hampshire. Generally speaking, a plan validly executed in another state (a “foreign plan” ) is valid in New Hampshire. However, there may be good reasons to modify a foreign plan after a move or at the very least have an attorney licensed in New Hampshire review the documents to determine the foreign plan should be modified.
Having a valid plan does not cure all issues created by a move to New Hampshire from out of state. Validity merely ensures enforcement. Validity does not ensure your intentions are fulfilled. The law varies state to state. Upon moving to this state, the terms of a foreign plan may be interpreted under New Hampshire law and not the law where the plan was written. This can result in unintended consequences.
For instance, the source of the payment of the decedent’s debts and expenses is treated differently state to state. This can affect the size or amount of an inheritance or bequest given under the terms of a will. Of course this result can be adjusted by modifying the terms of the will after a move.
A foreign will requires an extra step in the probate process before the court accepts the will. The probate court mandates that an attorney licensed in the state where the foreign will was made sign an “Affidavit of Counsel” stating that the foreign will is valid under such other state’s laws.
A validly executed foreign health care advance directive is also valid under New Hampshire law. However, similar to the will, there may be situations where not having a New Hampshire “form” of the document could result in unnecessary delays or other problems. The New Hampshire health care advance directive form is particular. You grant end of life decision making powers in a very specific manner to your agent. It is unlikely that a health care power made outside of New Hampshire will include the specific language. In the event of a controversy over what your end of life wishes are, not having the specific New Hampshire language could make it difficult for the agent to be able to make end of life decisions, without court involvement.
Similarly, a validly executed foreign financial power of attorney is also valid under New Hampshire law. But there are differences in the law from state to state that may require updating the financial power of attorney for New Hampshire idiosyncrasies. For instance in some instances a financial power of attorney is used to qualify an incapacitated principal for government benefits such as Medicaid. In New Hampshire the power of attorney must not only specifically allow the agent to make gifts, the power of attorney must also specifically state the agent has the authority to make gifts to qualify the principal for Medicaid benefits. Furthermore, in New Hampshire the agent under a power of attorney may not make gifts to him or herself, unless the document gives the agent specific power to do so.
New Hampshire adopted the Uniform Trust Code, which provides trusts governed by New Hampshire laws with a great deal of flexibility. A Trust drafted while you resided in a different state most likely specifically states that the Trust is governed by that state’s laws. Changing the Trust to provide it is governed by New Hampshire law, would allow the Trust to operate under New Hampshire’s Uniform Trust Code thereby taking advantage of its flexibility.
Having a New Hampshire attorney review your estate plan ensures your intentions are carried out efficiently and effectively.
Denis Dillon is a director in McLane Middleton’s Portsmouth office. He can be reached at (603) 334-6921 or [email protected].