You can have the best plan in the world, but if it is not executed correctly, it will fail. This is literally true when it comes to following the proper procedures for signing estate planning documents and thus making them legally valid. To make matters more complicated, each specific type of estate planning document has its own execution requirements.
1. Formal Will
A formal will must be in writing and is generally a typed document. It must be (a) either signed by the testator or signed by a third party in the testator’s presence at the direction of the testator, (b) signed in the presence of two witnesses, and (c) signed by the two witnesses with the understanding that they are signing the testator’s will.
The witnesses should be “disinterested” meaning that they are not named as beneficiaries in the will and are not natural heirs of the testator.
Notarization of the will is not required and is also irrelevant: notarization does not take the place of the two-witness requirement.
2. Holographic Will
If the “material” terms of a will are written in the testator’s handwriting, it might be considered a holographic will. In such a case, the will does not have to be witnessed but must be signed by the testator. Although, if properly executed, holographic wills are valid, it is generally not recommended to execute a holographic will because there is a lot of room for error.
Just as with a formal will, notarization of the holographic will is not required and is in fact irrelevant.
Most estate plans are “trust-based,” meaning that the key document is a revocable living trust. A trust is a type of contract that, when properly drafted and funded, supersedes a will. The trust must express a declaration by the trust-maker indicating an intent to hold the property in trust. If the trust involves real property, it must be signed by the trust-maker.
Although it is not legally required, it is often wise to have the trust-maker’s signature notarized in case there is any dispute as to the authenticity of the trust-maker’s signature.
A trust does not have to be witnessed in most states but doing so does not make the trust invalid and might add an extra layer of protection.
4. Durable General Power of Attorney
A durable general power of attorney is a document that gives an agent the power to manage the principal’s financial affairs. In order for a durable general power of attorney to be valid, it must (a) contain the date of the document, (b) be signed by the principal or signed by a third party at the principal’s direction; (c) and either be notarized or be signed by two witnesses who are adults, who are not named as agents under the durable general power of attorney, and who were present when the principal signed the durable general power of attorney.
5. Advance Health Care Directive
An Advance Health Care Directive is a power of attorney for health care decisions as well as an expression of how the principal would like the health care agent to make his/her health care decisions. Just like a durable general power of attorney, an Advance Health Care Directive must (a) contain the date of the document, (b) be signed by the principal or signed by a third party at the principal’s direction; (c) and either be notarized or be signed by two witnesses who are adults, who are not named as agents under the advance health care directive, and who were present when the principal signed the durable general power of attorney.
In addition, if the principal is a resident in a skilled nursing facility, the Advance Health Care Directive must also be signed by a patient advocate or ombudsman designated by the Department of Aging. This is a precautionary measure meant to ensure that the skilled nursing facility patient is making a truly voluntary decision by signing the Advance Health Care Directive.