Detailed Answer
When someone dies intestate (without a valid will) in New Jersey, their assets pass under the state’s intestacy rules. If a minor (under 18) is an heir, New Jersey law uses several mechanisms to protect that inheritance until the child reaches the age of majority or another court-approved age.
1. Intestacy Distribution Under N.J. Stat. 3B:5-1
Under New Jersey’s intestacy statute, N.J. Stat. 3B:5-1, the entire estate passes to surviving blood relatives or spouses. If the only heir is a minor, the court will not distribute funds directly to the child but will require further protective steps.
2. Guardianship of Property
New Jersey Surrogate’s Court may appoint a guardian of the property under N.J. Stat. 3B:12-24. This guardian holds title to the minor’s share, manages investments, pays ongoing expenses (school, health care, etc.) and files annual accountings. The guardian’s authority typically ends when the minor turns 18—or up to age 21 if the court so orders.
3. Uniform Transfers to Minors Act (UTMA) Custodial Accounts
Under New Jersey’s UTMA, N.J. Stat. 46:38B-1 et seq., the estate can transfer assets directly into a custodial account naming a responsible adult as custodian. This avoids probate for those assets and allows more flexible use. The custodian manages the account until the minor turns 21 (or a younger age if specified).
4. Special Needs Trusts and Supplemental Planning
If a minor beneficiary has special needs, a properly drafted special needs trust can preserve eligibility for government benefits while protecting their inheritance. Even for a typical minor, a court-approved testamentary trust (created by appointment in intestacy proceedings) can provide greater control over timing and use of distributions.
Disclaimer: This article is for informational purposes only and does not constitute legal advice. Always consult a qualified attorney for advice on your specific situation.
Helpful Hints
- File for letters of administration promptly to start the intestacy process without delay.
- Nominating a guardian of the property in writing can guide the court’s appointment.
- Consider UTMA accounts for smaller inheritances to streamline management and avoid lengthy court oversight.
- Maintain detailed records of all receipts, disbursements and annual accountings.
- Explore special needs trust options if the minor beneficiary receives public benefits.