Wills in Mexico
By Kay Davis
When there is no Mexican Will, decisions are left up to the courts. However, if all of your property in Mexico falls under general law or contract, then a Mexican Will may not be required, e.g. bank accounts with designated beneficiaries. But if you own “stuff”, you need more.
For example, where property is owned 50/50, if the couple does not have a Mexican Will and there are children, the surviving spouse will probably be disinherited. Most couples want a Will for this reason alone. A simple Mexican Will can cost from $150 to $600 USD although once a year they can be had at a reduced fee. It often occurs in September.
Are US and Canadian Wills valid in Mexico? Yes. However, a Mexican Will is faster and cheaper. Mexican Wills are also valid in the US and Canada. Again, it is wise to have a Will for every jurisdiction in which you have property.
Your executor locates the property, prepares an inventory, pays all debts, and is generally in charge of administering the estate. When possible, the executor should live in Mexico.
Mexico does not have an estate tax or deemed disposition rules. However, the settlement of an estate still has expenses, e.g. attorney and appraisal fees, transfer taxes, bonds, etc.
Are other estate planning documents recommended? A Mexican Durable Power of Attorney would come into effect upon disability of the owner and allows decisions to be made affecting property in Mexico. Good idea.
Medical directives should also be prepared to give caregivers guidance in health care choices, especially regarding incapacity. This document is especially important when the person is not married and is dependent on family, doctors, friends and neighbors.
Estate planning refers to complexities of international estates: family relationships, ancillary probate processes, US estate taxes, survivorship issues, special planning situations, etc. Mexico has no such legal reference. So here are some tips:
1. Make sure you know what your Mexican Will says. Have it translated.
2. If the Mexican Will is silent on the matter of prior Wills, all prior Wills are revoked by operation of Mexican law. Sometimes this is not your intention. Be clear.
3. Coordinate all your Wills to achieve your goals. A Mexican Will should cross-reference any US or Canadian Will, and visa-versa.
4. If your only Will is Mexican, and you own property abroad, include a residuary clause –they are important in the US to avoid presumption of an intestate estate (as if there is no will) wherein some assets could be distributed and taxes paid in the US from the residuary unless specifically directed otherwise.
5. Consider also:
a) Simultaneous Death Clause presumes that one predeceased the other.
b) Testamentary Clause directs the executor to create trusts: Mexican, US or Canadian.
c) No Contest Clause discourages heirs from contesting the Will.
d) Letter of Intent guides the Executor so that Will need not be cluttered, requiring expensive re-do’s if you should change your mind. There are no codicils in Mexico. Include digital estate matters, e.g. online banking or investments, Facebook, Email accounts, LinkedIn, Twitter – provide ID Names and pass codes so your Executor can shut them down. Include special instructions and bequests of personal property.
Summing it all up, the small cost of a Mexican Will and a Durable Power of Attorney is well spent for peace of mind from knowing your wishes will be carried out.
The full length version of this document can be found at accesslakechapala.com. Click on Blog at top of page, right end. Type in “Arranging Your Will and Testament.”