Owning your own home has long been part of “the American Dream.” People commonly work hard to purchase their own home and build equity in that real estate for many years. For many, the family home may be their most substantial asset at the time of his or her death. Like any other major asset, it is important to keep the family home in mind when creating long term financial goals as well as your estate plan. The property you use as a family home can qualify for particular protections in the event of your death, if that home is your “homestead.”
The idea that your home is provided certain protections from creditors is deeply embedded in Minnesota law. The probate code provides that a homestead will be safe from the claims of most creditors. A surviving spouse will also have additional protections, and in many cases it will be not possible for the title to the home to be transferred to anyone but the surviving spouse during the spouse’s life. The surviving spouse has homestead rights in the home even if the will of the deceased spouse leaves the home to someone else. This right to remain is in addition to and separate from a surviving spouse’s right to take an elective share from the estate if the deceased spouse attempted to disinherit the surviving spouse, or leave him or her a small percentage of the estate. However, the surviving spouse cannot take the homestead as his or her elective share. Moreover, a surviving spouse is by no means required to exercise the homestead protections. He or she can voluntarily waive the homestead rights. This waiver must be done in writing, and with full disclosure of the nature and repercussions of the waiver.
Whether the house is a homestead is a fact sensitive question. The law provides that a homestead is the house that the person occupies as his or her primary dwelling. The homestead will apply not only to the home, but also to the land upon which the home is built. In undeveloped locations, the homestead can cover more than one taxed parcel of land. Farmers should be aware that there are additional homestead protections available for family farms.
Let us help you understand your rights and responsibilities in the probate process. Call today at 651-371-9117 for a consultation.