Alaska Wills and Trusts Requirements

ALASKA WILLS AND TRUSTS REQUIREMENTS

Statutory Authority.

Wills: Ak. Stat., Tit. 13, Chap. 12: Intestacy, Wills & Donative Transfers (Ak. Stat. §§13.12.101, et. seq.).

Trusts: Ak. Stat., Tit. 13, Chap. 36: Trust Administration (Ak. Stat. §§13.36.005, et. seq.).

Alaska Will Requirements.

To execute a valid will, an Alaska testator must be at least 18 years old and “of sound mind.”  An Alaska will must be in writing and must be signed by the testator (or signed in the testator’s name by an individual signing at the testator’s direction while in the testator’s conscious presence).  

Alaska wills must also be signed by at least two witnesses. The witnesses must observe the testator signing the will or hear the testator acknowledge that the will or signature is authentic.  Witnesses must sign within a reasonable time after witnessing the testator’s signature or acknowledgement.

The only qualification necessary to witness an Alaska will is that the individual must be generally competent to act as a witness. An interested witness (i.e., someone who stands to benefit from the will) does not invalidate an Alaska will or any provision of the will. 

An Alaska will may incorporate by reference another document in existence when the will is executed.  The will must clearly manifest the testator’s intent to incorporate the other document and must describe the document sufficiently to allow identification.  

Alaska law specifically authorizes incorporation by reference of a written statement or list disposing of the testator’s tangible personal property other than money. The testator’s will must specifically reference the list—sometimes called a “personal property memorandum”—and the list must bear the testator’s signature. A personal property memorandum must describe each devised item and intended recipient with reasonable certainty. The testator can create a personal property memorandum before or after executing the will and can alter the list after its initial preparation. 

Though Alaska does not require notarization of wills, an Alaska will can be made “self-proved” if the testator and witnesses execute notarized “self-proving affidavits.” The affidavits confirm that the testator signed the will voluntarily and that—when signing—the testator had adequate legal capacity and was under no constraint or undue influence.  

When available, a self-proving affidavit eliminates the need for witness testimony to prove the will before the probate court. Self-proving affidavits may be executed simultaneously with the will or later and are typically included as attachments to the original will. The Alaska State Legislature publishes form language for self-proving affidavits at Ak. Stat. §13.12.504. 

Alaska’s probate laws provide a mechanism through which a testator, personal representative, or interested person with the testator’s authorization may petition a probate court before the testator’s death to determine that a will is valid—subject to later revocation or amendment.

No-contest (or “in terrorem”) clauses—which penalize a party for contesting a will or initiating other estate-related proceedings—are notionally valid in Alaska, but the clauses are unenforceable if the contesting person has probable cause for instituting the proceedings.

Amendment, Revision, and Revocation of Alaska Wills.

A testator may amend an Alaska will by executing a codicil (a separate addendum that amends an existing will) or another will.  In either case, a document amending a will must satisfy all legal requirements for execution of an original will.  

A testator can revoke an Alaska will by executing a new will that revokes the prior will expressly or by inconsistency. Alaska law presumes that a later will that does not expressly revoke a prior will revokes the prior will by inconsistency if the later will completely disposes of the testator’s estate. A later will that does not completely dispose of the testator’s estate is presumed to have been intended as a supplement to the earlier will. When a later will is treated as a supplement, both wills are fully operative except to the extent of any inconsistent provisions.  The later-executed will takes precedence if inconsistent provisions are present. 

An Alaska will may also be revoked by performance of a “revocatory act” by the testator (or by another person acting at the testator’s direction while in the testator’s presence). A “revocatory act” is an action taken with the intent to revoke the will or part of the will. Revocatory acts include burning, tearing, canceling, obliterating, or destroying the physical document.

If an Alaska testator marries after executing a will, the surviving spouse inherits the same share of the estate he or she would have inherited had the testator died intestate—adjusted for any distributions to children of the testator born before the marriage and who are not children of the surviving spouse.  An omitted later-wed spouse’s presumed share is inapplicable if the will was made in contemplation of the marriage, the testator intended the will to apply notwithstanding a subsequent marriage, or the testator made other provisions for the surviving spouse outside the will intended in lieu of the will.

If a child is born to or adopted by an Alaska testator after execution of a will, the after-born child may inherit a share of the estate.  If the testator had no other living children when executing the will, the after-born child’s share is equal to what the after-born child would have inherited had the testator died with no will. If the testator had other children who the testator provided for in the will, the after-born child’s share is calculated based on the devises to the other children. An omitted after-born child’s share is inapplicable if the omission was intentional or the testator made other provisions for the child in lieu of the will.

If a testator or settlor divorces after executing an Alaska will or revocable trust, revocable provisions in the will or trust in favor of the former spouse (or a relative of the former spouse) are deemed revoked. Automatic revocation upon divorce does not occur if the will or trust instrument, a property settlement agreement, or a court order states that the divorce does not affect the will or trust. A will or revocable trust provision revoked by divorce is treated as though it was disclaimed by the former spouse and can be revived by remarriage. Alaska law also holds that a former spouse divorced from an Alaska decedent does not qualify as a “surviving spouse” for purposes of Alaska’s other probate and non-probate transfer rules. 

Holographic and Oral Wills.

A document that does not fully satisfy the requirements for an attested Alaska will may be nonetheless valid as a holographic will if it is signed by the testator and all material provisions of the document are in the testator’s handwriting.  

Oral (or “nuncupative”) wills are no longer recognized under Alaska law.

Alaska Trust Requirements.

Alaska trusts are primarily governed by statutes codified within Chapter 36 of Title 13 of the Alaska Statutes and common law.  Alaska has not adopted the Uniform Trust Code approach used by many states—though some Alaska trust statutes are similar to provisions of the uniform act.

While Alaska law recognizes oral trusts, most Alaska trusts are governed by a written trust instrument. Some types of trusts—such as trusts relating to real estate or which otherwise fall within the Statute of Frauds—are not valid unless evidenced by a written instrument. 

The three essential parties to an Alaska trust are the settlor, beneficiary, and trustee. The settlor—sometimes called “grantor” or “trustor”—is the person who originally forms the trust and transfers property in trust. The settlor typically prepares—or hires an attorney to prepare—the written trust instrument governing the trust. The beneficiary is the person designated to enjoy the benefit of assets held in a trust. An Alaska trust can have more than one beneficiary, and a beneficiary may also be one of the other parties to the trust.  

The trustee is the person responsible for administering the trust, managing its assets, and making distributions to beneficiaries. Trustees are ordinarily appointed within the trust instrument or under its terms, though Alaska law allows for appointment of a trustee by a court if necessary. 

Trustees of Alaska trusts are generally considered fiduciaries, and a trustee must administer a trust with prudence, diligence, and discretion—using the judgment exercised by ordinary persons in carrying out their own affairs. Trustees who manage assets are ordinarily held to the “prudent investor rule”—under which a trustee must manage trust assets prudently considering the purposes, terms, distribution requirements, and other circumstances of the trust. A trust’s settlor may alter the trustee’s duties and obligations—except that the rules relating to self-dealing and lending trust funds cannot be modified.

Alaska law requires that a trustee of a trust primarily administered in Alaska be an Alaska resident—except that a non-resident may serve as co-trustee if another co-trustee is a resident. A foreign corporation acting as trustee of an Alaska trust must be authorized to transact business in Alaska.

The trustee of a trust principally administered in Alaska must register the trust with an Alaska court with jurisdiction at the trust’s principal place of administration. A trustee registers a trust by filing a statement identifying the trust’s settlor (or testator for testamentary trusts), original trustee, and date.

Alaska law also authorizes—but does not require—appointment within a trust instrument of two other parties to the trust—the “trust protector” and “trust advisor.” A trust protector may be appointed and empowered by the trust instrument to—for example—remove and appoint the trustee, amend the trust instrument for favorable tax treatment, or modify beneficiary interests. A trust advisor appointed within a trust instrument provides the trustee with advice—which the trustee may or may not be required by the trust instrument to follow—regarding management and investment of trust assets.

An Alaska trust can be revocable or irrevocable. The settlor of a revocable trust retains the power to amend or revoke the trust. The settlor of an irrevocable trust surrenders the power to amend or revoke the trust. Alaska law assumes that an Alaska trust is revocable unless the trust is expressly made irrevocable. 

A settlor may modify or revoke a revocable trust using the method specified in the trust instrument or—if the trust instrument’s method is not the exclusive method—through another signed writing (other than a will) delivered to the trustee. An agent acting under power of attorney may not revoke or modify a trust on the settlor’s behalf unless expressly authorized by the trust instrument.

Alaska revocable living trusts are sometimes used in estate planning as a substitute for a will, as they allow property to transfer to beneficiaries outside probate. If a revocable living trust’s settlor is also trustee, the trust instrument should name a successor trustee to assume management and distribute assets after the settlor’s death. Alaska law allows a living trust’s settlor or trustee to petition a court to determine the trust’s validity before the settlor’s death—subject to later revocation or modification.

Under limited circumstances, Alaska irrevocable trusts may be modified or terminated by a court upon petition of the trustee, settlor, or beneficiary. Court-ordered modification or termination may be permissible to adjust administrative provisions, to correct mistakes to conform to the settlor’s intent, to achieve the settlor’s tax objectives, or if the trust’s value is less than $50,000 and the trust is uneconomical to administer.

Special Considerations.

Estate Taxes: Alaska does not impose either estate or inheritance taxes.  Large Alaska estates may still be liable for federal estate taxes.

Simplified Probate:  Alaska law provides a process for informal administration of uncontested estates. To request informal administration, an interested person must file a petition requesting appointment of a personal representative for informal probate. If the appointment is granted, the personal representative administers the estate using a streamlined process that involves less direct supervision by the probate court. 

Alaska also has a process by which a rightful successor to personal property within a small estate may obtain possession of personal property outside of probate by executing a compliant affidavit. The affidavit sets forth statutorily required information—such as the successor’s relationship to the decedent, the basis of the right to recover the specific property, and the status of any personal representative appointment.  To qualify as a small estate, the probate estate must not include real estate, the decedent’s vehicles must not exceed $100,000 in value, and remaining personal property must not exceed $50,000. 

Non-Probate Transfers:  Along with living trusts, Alaska provides several additional options for transferring assets outside probate.  Assets co-owned as joint tenants with right of survivorship automatically transfer to a surviving owner upon the other owner’s death.  Similarly, property co-owned by tenants by the entirety are subject to a right of survivorship in favor of the surviving owner.  In Alaska, tenancy by the entirety may only be used by married spouses and only for ownership of real estate.

Married Alaska residents may also choose to co-own some or all property as “community property with right of survivorship.” Spouses must “opt in” to Alaska’s community property system by creating a community property agreement.

POD (payable-on-death) and TOD (transfer-on-death) designations, which provide for automatic transfer to a beneficiary upon an owner’s death, can also be used in Alaska for many assets.  For instance, POD designations can be added to financial accounts and CDs, and TOD designations can be used with assets like registered securities and brokerage accounts.  

Similarly, some assets—like retirement accounts and life insurance—allow owners to name a beneficiary who automatically takes ownership of the asset upon the original owner’s death.

Transfer-on-Death (TOD) Deeds and Vehicle Titles:  Alaska is among the states that recognize transfer on death designations on real estate deeds (also called “TOD deeds” or “beneficiary deeds). Real property subject to a TOD deed automatically transfers to the named beneficiary upon the owner’s death, avoiding the need for probate.  Alaska does not recognize TOD designations on vehicle titles.

Spousal Shares: To avoid spousal disinheritance, Alaska law grants a surviving spouse a right to an elective share of one-third of the deceased spouse’s “augmented estate,” even if the decedent’s will provides differently. The “augmented estate” includes the decedent’s net probate estate, the value of certain non-probate transfers (e.g., property co-owned in joint tenancy or with a POD designation), and the value of certain of the surviving spouse’s property.  

Alaska’s spousal elective share is in addition to any allowances and exemptions to which a surviving spouse is entitled. Alaska provides for a supplemental elective share up to $50,000 if the surviving spouse’s interest in the deceased spouse’s estate is less than $50,000.

If a married Alaska decedent is intestate, the surviving spouse’s intestate share is the entire estate if the deceased spouse leaves no surviving parents or descendants. The surviving spouse also receives the entire estate if all the deceased spouse’s surviving descendants and also the surviving spouse’s descendants (i.e., neither spouse has a child who is not the child of the other spouse). Otherwise, the surviving spouse’s intestate share is as follows:

• If the deceased spouse leaves a surviving parent and no surviving descendants, the surviving spouse’s share is $200,000, plus ¾ of the balance. 
• If all the deceased spouse’s descendants are also descendants of the surviving spouse but the surviving spouse has other descendants, the surviving spouse’s share is $150,000, plus one-half of the balance. 
• If the deceased spouse leaves surviving descendants who are not the surviving spouse’s descendants, the surviving spouse’s share is $100,000, plus one-half of the balance.

Alaska Spendthrift Trusts and DAPTs: Alaska’s laws regarding “spendthrift trusts”—which restrict transfer of beneficiaries’ interests in a trust—protect trust assets from a beneficiary’s creditors. A beneficiary’s creditors cannot attach assets held in a spendthrift trust until actually distributed to the beneficiary. Real estate or tangible personal property owned by a spendthrift trust and occupied or used by a beneficiary may still be protected from creditors—as long as the use or occupancy is in accordance with the trustee’s discretionary authority under the trust instrument. 

Creditors of an Alaska revocable trust’s settlor can attach trust assets during the settlor’s life—regardless of whether the trust includes a spendthrift provision. If a deceased settlor’s estate is insufficient to satisfy creditor claims, creditors may attach trust assets to satisfy claims against the estate.

Alaska is among the states with the strongest laws authorizing Domestic Asset Protection Trusts (DAPTs)—a form of spendthrift trust that provides exceptionally strong protection from creditors. DAPTs are irrevocable, “self-settled” (i.e., the settlor is also beneficiary), and designed for maximum asset protection.

Assets held in an Alaska DAPT are nearly immune from attachment by most creditors. A creditor must demonstrate that a transfer was made with intent to defraud the creditor to set aside a transfer to a DAPT.

The settlor of an Alaska DAPT can retain certain rights in the trust without sacrificing the strong protections from creditors. Among other things, a settlor can reserve the right to act as trust advisor and advise the trustee on investments; veto distributions from the trust; appoint or remove a trustee or trust protector; decide how trust assets will be distributed after the settlor’s death, and receive distributions from the trust (subject to limitations).

Alaska DAPTs must meet precise standards specified in the authorizing statute. An Alaska DAPT must have—for instance—a trustee resident in Alaska, a trust instrument expressly incorporating Alaska law, and a discretionary standard for distributions not controlled by the settlor. A settlor must also execute a sworn affidavit attesting that, for example, the settlor has title to transferred assets, will not be made insolvent by the transfer, does not intend to defraud creditors, and is not delinquent on child support payments.

Creating a will or trust does not have to be difficult or intimidating.  However, certain circumstances—like second marriages, stepchildren, aging parents, special needs beneficiaries, guardianships, and business interests (to name a few)—can add a layer of complexity and result in unforeseen long-term consequences.  Whenever any out-of-the-ordinary issues are present, it’s a good idea to consult with an experienced attorney familiar with and licensed under the laws of the relevant jurisdiction.