Alabama Wills vs. Trusts
Estate planning in Alabama can be straightforward with proper guidance. The Yellowhammer State provides several distinctive advantages, including expedited probate procedures for estates valued under $25,000, complete absence of state-level estate and inheritance taxation, and comprehensive legal safeguards for spouses. Given Alabama’s adoption of the uniform trust code and default assumption that trusts are revocable, knowing whether a will or trust better suits your situation is essential. Making informed estate planning decisions helps protect your family from unnecessary expenses, legal complications, and delays while ensuring your assets are distributed according to your wishes.
Table of Contents
US Map For The Different Will and Trust Requirements by State
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Alabama Will Requirements
An Alabama Last Will and Testament should include:
- Age and Capacity: Testator must be “of sound mind” and at least 18 years old
- Format: Must be in writing
- Signature: Must be signed by the testator or by someone else at the testator’s direction and in their presence
- Witnesses: Must be signed by at least two competent witnesses
Witness Requirements
For Alabama wills:
- Witnesses must actually observe the testator sign the will or acknowledge that the signature is valid
- The only prerequisite to witness a will in Alabama is that the individual must be generally competent to act as a witness in the state
- An Alabama will is not invalidated if a witness has an interest in the will
Self-Proved Wills
Though Alabama wills need not be notarized, an Alabama will can be made “self-proved” through a notarized affidavit:
- The affidavit must be executed by the testator and the will’s witnesses
- When a will is self-proved, it can be admitted to probate based upon the affidavit without witness testimony
- The affidavit may be executed at the same time as the will itself or at a later time, as long as the testator and witnesses remain living
- The Alabama legislature has published a proposed form for the affidavit at AL Code §43-8-132
Incorporation by Reference
An Alabama will may incorporate by reference:
- Any document in existence when the will is created if the document and intent to incorporate are sufficiently identified in the will
- Alabama law does not authorize incorporation of personal property memoranda or similar lists of tangible personal property created after execution of a will
Alabama law generally interprets wills so as to give effect to the intent of the testator, and wills are construed to pass all property owned by the testator at the time of death.
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Amendment, Revision, and Revocation of Alabama Wills
Amending an Alabama Will
An Alabama will may be amended at any time prior to the testator’s death, provided the testator retains adequate capacity:
- Amendment can be accomplished through a codicil (a written addendum to an existing will)
- A codicil must comply with all formalities required for execution of a valid will
Revoking an Alabama Will
Alabama wills can be revoked in whole or in part by:
- Execution of a later will that either expressly revokes the prior will or implicitly revokes it due to inconsistency
- Physical destruction of the will, such as by burning or tearing, with the intention of revoking the will
- Another person may revoke a will through destruction if done at the testator’s direction in the presence of two witnesses
Automatic Revocation by Divorce
Effect of Marriage After Will Execution
If a testator is married after execution of a will, the surviving spouse receives a share of the estate as if the testator had died intestate. The presumed share of an omitted spouse is inapplicable if:
- The omission appears to have been intentional
- The decedent made other arrangements for the spouse intended in lieu of a testamentary devise
Children Born After Will Execution
If a child is born to or adopted by the testator after execution of a will:
- The after-born child receives a share of the estate as if the testator had died intestate
- The presumed share of an after-born child is inapplicable if there is evidence that the omission was intentional or if the decedent made other arrangements for the child intended to be in lieu of a testamentary devise
- An after-born child’s share is also inapplicable if the decedent had at least one other child when the will was executed and the testator leaves substantially all of his or her estate to the after-born child’s other parent
Holographic and Oral Wills
Holographic Wills
Alabama law does not recognize holographic wills. A handwritten will can still be valid, but it must satisfy all of the other requirements for execution of a valid will, including attestation by witnesses. A holographic will can be probated in Alabama if it was validly executed in another state in compliance with the laws of the state in which it was executed.
Oral (Nuncupative) Wills
Oral (or “nuncupative”) wills are not recognized under Alabama law.
Alabama Trust Requirements
Trusts in Alabama are principally governed by the Alabama Uniform Trust Code, enacted by the legislature at AL Code §19-3B-101, et. seq.
Requirements for a Valid Alabama Trust
For a trust to be valid under Alabama law:
- An Alabama trust’s purpose must be lawful, not in violation of the state’s public policy, and must be possible to achieve
- In general, the purpose must be to benefit the interests of the trust’s beneficiaries
- An Alabama trust is invalid to the extent it was induced through fraud, duress, or undue influence
- The settlor must have adequate capacity to create the trust and express an intent to create a trust
- For revocable trusts, the standard for capacity is the same as for wills
Trust Creation Methods
Alabama trusts can come into being through:
- Transfer of property by a settlor to a trustee (either during life or through a will or other testamentary instrument)
- A settlor’s declaration that property is owned as trustee
- Exercising a power of appointment in favor of a trustee
- A court order establishing the trust
Required Trust Elements
Alabama trusts must also have:
- A reasonably ascertainable beneficiary (subject to exceptions such as for charitable trusts, trusts for the care of animals, and certain trusts for noncharitable purposes)
- A trustee with actual duties to perform
- The trustee must have legal capacity to act as trustee—particularly, capacity to hold title to trust assets
Sole Trustee/Beneficiary Rule
An Alabama trust’s sole trustee cannot also be its sole beneficiary.
Trustee Responsibilities
Trustees who manage assets are governed by the “prudent investor rule,” though the rule may be modified under the terms of the trust.
Oral Trusts
Though most trusts are evidenced by a written instrument setting forth the trust’s terms, Alabama law recognizes oral trusts. However, the creation and terms of an oral trust must be established by clear and convincing evidence.
Spendthrift Provisions
Although the general rule is that creditors of a trust’s beneficiaries may attach a beneficiary’s interest in a trust, Alabama protects beneficiary interests from attachment if a trust includes:
- A “spendthrift provision”
- Provisions for discretionary distributions
In either case, most creditors of beneficiaries cannot attach trust assets until actually distributed to the relevant beneficiary. However, spendthrift provisions do not prevent attachment for satisfaction of certain domestic support obligations, tax claims, or if the creditor provided services for the protection of the beneficiary’s interest in the trust (or to the extent a mandatory distribution to the beneficiary is overdue).
Trust Termination
Alabama trusts terminate upon:
- Revocation or expiration under the trust’s own terms
- When there is no purpose of the trust remaining to be achieved
- When the trust’s purpose becomes unlawful, impossible, or contrary to public policy
A trust may also be modified or terminated by a court upon the petition of interested parties.
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Special Considerations
Estate Taxes
No State Estate or Inheritance Tax
Alabama does not impose estate taxes or inheritance taxes. Large Alabama estates may still be liable for the federal estate tax.
Simplified Probate
Small Estate Procedures
Alabama allows for a simplified probate process for small estates—defined as $25,000 or less (periodically adjusted for inflation). Important considerations:
- Alabama small-estates probate is not available if the estate includes real property
- If an Alabama estate is eligible for small estate probate, the personal representative files a petition for summary distribution with the probate court
- If granted, the streamlined process allows the personal representative to distribute assets to heirs without the full probate administration process
Non-Probate Transfers
No TOD Deeds or Vehicle Titles
Although some states allow for TOD designations within real estate deeds (often called “beneficiary deeds”), Alabama does not recognize them. Beneficiary designations on vehicle titles are also not permitted under Alabama law.
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Wills vs. Trusts: Comparison
| Feature | Wills | Trusts |
|---|---|---|
| When It Takes Effect | After death | Can be immediate (living trust) or after death (testamentary trust) |
| Probate Process | Requires probate | Assets in trust avoid probate |
| Privacy | Public record | Generally private |
| Challenges | Can be challenged in probate court | More difficult to challenge |
| Cost to Create | Generally less expensive | Usually more expensive |
| Ongoing Administration | None until death | May require ongoing management |
| Protection During Incapacity | None (requires separate power of attorney) | Can provide management if grantor becomes incapacitated |
| Alabama Special Feature | Simplified probate for estates under $25,000 without real property | Presumed revocable; oral trusts recognized with clear and convincing evidence |
Conclusion
Creating a will or trust does not have to be difficult or intimidating for Alabama residents. However, certain circumstances—like second marriages, stepchildren, aging parents, special needs beneficiaries, guardianships, and business interests—can add complexity and result in unforeseen consequences.
Alabama offers unique estate planning tools including simplified probate for small estates under $25,000, no state estate or inheritance taxes, and strong spousal protections through the elective share and additional statutory allowances. While Alabama does not recognize holographic wills, TOD real estate deeds, or tenancy by the entirety, it does provide other effective methods for avoiding probate and protecting family interests.
When any out-of-the-ordinary issues are present, it’s advisable to consult with an experienced attorney familiar with and licensed under Alabama law to ensure your estate plan takes full advantage of the state’s provisions while avoiding potential pitfalls.
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FAQs: Alabama Wills and Trusts
Q: What are the requirements for a valid will in Alabama?
A: A valid Alabama will must be in writing, signed by the testator (who must be at least 18 and of sound mind), and witnessed by at least two competent people. The testator may also sign through another person at their direction and in their presence. Witnesses must observe the testator sign the will or acknowledge the signature. Unlike some states, Alabama does not recognize holographic (handwritten but unwitnessed) wills, and oral wills are not valid under Alabama law.
Q: Does Alabama have estate or inheritance taxes?
A: No, Alabama does not impose state-level estate taxes or inheritance taxes. Large estates may still be subject to the federal estate tax, which applies to estates exceeding the federal exemption limit (currently $13.99 million per individual in 2025). This favorable tax environment means Alabama residents can focus on other aspects of estate planning without state-specific tax concerns.
Q: Can I avoid probate with a small estate in Alabama?
A: Yes, Alabama offers a simplified probate process for small estates valued at $25,000 or less (periodically adjusted for inflation). To qualify, the estate must not include real property. The personal representative files a petition for summary distribution with the probate court, and if granted, can distribute assets to heirs without going through the full probate process. For larger estates or those containing real estate, other probate-avoidance strategies like living trusts are recommended.
Q: Does Alabama recognize transfer-on-death deeds for real estate?
A: No, Alabama does not recognize transfer-on-death (TOD) deeds for real estate, unlike some other states. This means you cannot use a beneficiary deed to transfer real property directly to heirs outside of probate. Similarly, Alabama does not allow TOD designations on vehicle titles. To avoid probate for real estate in Alabama, you’ll need to consider alternative strategies such as creating a living trust or holding property in joint tenancy with right of survivorship.
Q: How are surviving spouses protected under Alabama law?
A: Alabama protects surviving spouses through several mechanisms. If a spouse dies with a will that provides little or nothing for the survivor, the surviving spouse can claim a statutory elective share equal to one-third of the decedent’s probate estate (or the entire estate reduced by the spouse’s separate estate, if less). Additionally, surviving spouses may be entitled to statutory allowances for homestead (up to $15,000), personal property (up to $7,500), and a family allowance (up to $15,000).
Q: What happens if I marry after making my will in Alabama?
A: If you marry after executing a will in Alabama, your spouse may receive a share of your estate as if you had died without a will (an intestate share). This presumption doesn’t apply if your will shows that the omission was intentional or if you made other non-probate arrangements for your new spouse that were intended to be in lieu of a testamentary provision. To avoid potential confusion, it’s advisable to update your will after any major life event, including marriage.
Q: Are trusts revocable or irrevocable by default in Alabama?
A: In Alabama, trusts are presumed to be revocable unless the trust instrument expressly states that the trust is irrevocable. This differs from the law in some states where trusts are presumed irrevocable by default. A revocable trust can be modified or terminated by the settlor during their lifetime, offering greater flexibility, while an irrevocable trust generally cannot be changed once established. Understanding this default provision is important when creating trust documents in Alabama.
