Virginia, like the majority of U.S. states, doesn’t charge a state inheritance or estate tax. The state does enforce a rare probate tax, though, should your estate need to go through that process. Smaller estates may not need to pass through probate but all estates need to understand all of the other laws that relate to either probate and inheritance in the state of Virginia. A financial advisor can help you navigate the complicated terrain of estate planning and Virginia inheritance laws.
Does Virginia Have an Inheritance Tax or Estate Tax?
- Final individual federal and state income tax returns: Due by tax day of the year following the individual’s death.
- Federal estate/trust income tax return: Due by tax day of the year following the individual’s death.
- Federal estate tax return: Due nine months after the individual’s death, though an automatic six-month extension is available if asked for prior to the conclusion of the nine-month period. Note that this is required only of individual estates that exceed a gross asset and prior taxable gift value of $13.61 million in 2024.
Dying With a Will in Virginia
If you pass away with a valid will, the property distribution process that ensues is significantly simpler than for those who die without one. In nearly every case, your property will be inherited exactly as you spelled out in your will. Not all testate estates, referring to those with a valid will in place, are created equally, though. A few qualifications will ultimately decide how the probate court process will manage its property.
Estates that include no real property and $50,000 or less in personal property are considered “small estates,” according to Virginia inheritance laws. These estates can avoid any sort of probate proceeding, as long as at least 60 days have passed since the individual’s death. But if an estate doesn’t meet the guidelines listed above for small estates, it will need to go through formal administration probate.
For reference, real property is land or anything fixed to it, such as a home. The rest of the estate, like vehicles, furniture, technology, jewelry, investments and cash fall under personal property. However, non-probate assets, such as insurance policies and IRAs, are separate.
Dying Without a Will in Virginia
Wills are meant to label exactly who will inherit what property, so how does Virginia handle the distribution of property from an intestate estate, one without a valid will? The answer: intestate succession laws that provide a hierarchy of heirs depending on their familial closeness to you. In fact, most inheritance laws are in place to protect intestate estates, as testate wills are usually fairly straightforward.
The Probate Process in Virginia Inheritance Law
When a decedent has not created a will, his or her estate must go through the Virginia probate process under its intestate succession laws. This ensures that the property within the estate goes where it’s supposed to. The court doesn’t do any hands-on management of the estate, though, so it will either select an executor or approve an executor the estate’s heirs have appointed.
As stated above, the probate process for testate estates is only used if the decedent owned real property and/or $50,000-plus in personal property. This is again done under the supervision of the court to safeguard the estate from any situation that could put it in harm’s way, especially when it is of significant value. Because a valid will is present, the court appoints the executor listed, unless that person has died as well.
Virginia inheritance laws uniquely include a probate tax in the probate process that is based on the value of the estate in question. Most often, this is a $1 state tax and $0.33 local tax for every $1,000 within the estate. So if your estate were valued at $100,000, your probate tax would be $133.
Whether there’s a will or not, an estate cannot be distributed among its heirs until the debts of the deceased are taken settled. For example, an executor will not only be required to pay off the decedent’s taxes, but also his or her final expenses (if they were paid from outside of the estate), credit bills and any other general costs.
Virginia does not employ probate-specific courts. Instead, all probate cases are handled directly through the circuit courts of the county where the decedent lived.
Virginia Inheritance Laws for Spouses
Similar to the intestate succession laws of most states, spouses in Virginia are given hefty rights to inheritance. First and foremost, if you die leaving solely a surviving spouse behind without children, they will receive your entire estate. The same rule also applies if all of your surviving children are with your spouse.
Just one-third of your estate will go to your surviving spouse if one or more of your surviving children are from an ex-partner. As you might assume, the other two-thirds are divided among your children per stirpes, meaning in even shares.
Virginia is an elective share state when it comes to disinheriting a spouse from your will. So when you die, your surviving spouse has the right to elect to inherit a part of your estate. However, taking all of the decedent’s non-probate assets is out of the question.
Virginia Inheritance Laws for Children
The most basic child inheritance situation in Virginia is when there’s no surviving spouse. Predictably, your estate will then go to your children. But if there is a surviving spouse, your children will receive either no part or two-thirds of your estate, depending on if they’re your spouse’s children or not, according to Virginia inheritance laws.
Intestate Succession: Spouses & Children
|Who Inherits Your Property
|– If spouse, but no children
|– Entire estate to a spouse
|– If spouse and children are all with your spouse
|– Entire estate to a spouse
|– If spouse and children all or partly from an ex-spouse or partner
|– 2/3 of the estate to children
– 1/3 of the estate to a spouse
|– If children, but no spouse
|– Entire estate to children
As far as Virginia inheritance laws are concerned, biological and adopted children are one and the same. Therefore, they both receive the strongest rights possible for children of an intestate decedent. On the other hand, grandchildren are not privy to any automatic inheritance rights in intestate succession, unless their parent (your child) predeceased you.
If you die before your conceived child is born, it will receive the same inheritance rights to your intestate estate as any other biological child born during your lifetime. This policy also applies to any children born via artificial insemination with your genetic material.
Virginia law treats the inheritance rights of illegitimate children, or children born outside of marriage, a bit differently from most other states. An illegitimate child is only given an inheritance if his or her situation meets one of the following stipulations:
- The decedent and mother were married at some point, and it was either an illegal marriage, voided marriage or was dissolved by the courts
- A scientific genetics test reveals paternity, though the father must have acknowledged the child as his own and child support payments were not refused
While it’s certainly possible for a decedent to have legally adopted a stepchild or foster child, earning that person inheritance rights, it’s not guaranteed to the person by intestate succession. This is true regardless of how long he or she was living with you. If you do want to leave property to this person, though, simply write him or her into your will.
Unmarried Individuals Without Children in Virginia Inheritance Law
For those who have no surviving children or spouse, intestate succession laws specify which relatives are next in line to lay claim to the estate. The fundamental objective of this undertaking is to dig through your entire family tree and find any possible heir so that your intestate estate can end up in the hands of relatives. It goes as follows:
Intestate Succession: Extended Family
|Who Inherits Your Property
|– If parents, but no spouse or children
|– Entire estate to parents or parent
|– If no parents
|– Estate split evenly between siblings
|– If no siblings
|– Estate split evenly between nieces and nephews
|– If no nieces or nephews
|– Estate split evenly between paternal/maternal grandparents
|– If no grandparents
|– Estate split evenly between paternal/maternal aunts and uncles
|– If no aunts and uncles
|– Estate split evenly between paternal/maternal cousins
|– If no cousins
|– Estate split evenly between paternal/maternal great-grandparents
|– If no great-grandparents
|– Estate split evenly between paternal/maternal great-aunts and great-uncles
|– If no great-aunts and great-uncles
|– Entire estate to ex-spouse’s family if they died while married to you
If all else fails, your estate will become part of the state of Virginia through escheatment. This can all be avoided by simply creating a valid will under the laws of Virginia. Therefore it might be a good idea to become educated in estate planning.
Non-Probate Virginia Inheritances
Like most states, Virginia offers a standard list of assets that completely bypass the intestate succession process. Because most of the below accounts and policies have a beneficiary of some sort, their inheritance is already predetermined. Included in this scenario are:
If you’d like any of the above to be included in your estate or intestate succession in the absence of a will, you can simply name your estate as the beneficiary.
Other Situations in Virginia Inheritance Law
To be an heir under Virginia intestate succession, you must have outlived the decedent by at least 120 hours. This law becomes especially important when an accident or other fatal event occurs involving two relatives.
Similar to the law listed above governing inheritances for posthumous children of a decedent, the same applies to other relatives who were conceived prior to your death, according to Virginia inheritance laws. Relatives that you share one parent with are entitled to exactly half of the inheritance that they would receive if they were a full relative at the same level. So if a full-blood sibling is to receive 10% of your estate, a half-blood sibling would get 5%.
Just because an heir of a decedent currently is or has been an alien in the eyes of the U.S. federal government doesn’t mean that the person can’t inherit property according to typical Virginia inheritance laws. This applies to non-U.S. citizens as well.
Inheritance laws in Virginia can be beneficial to the beneficiaries if you plan ahead and make sure your estate is ready in advance. Without having a will, your estate will be left to the very specific line of succession of who can inherit your estate. This will typically just go through members of your family based on closeness to you. The laws in Virginia are set up to protect the family members of the estate owner if there is no will or other documents to establish what should happen to the deceased’s assets. A financial advisor can help you protect your assets as you start thinking about estate planning.
Tips for Estate Planning
- A financial advisor can help you create an estate plan. Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
- Doing estate planning entails using terms that may be unfamiliar to you. Here is a list of 10 key terms that will help you sort through your options and also be useful as you make personal financial decisions in other areas.
- Keep in mind that you could pay a stepped-up capital gains tax when inheriting property. You can use our capital gains tax calculator to determine how much you might pay.
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