New Mexico Wills vs. Trusts
Navigating New Mexico estate planning doesn’t have to be overwhelming. The Land of Enchantment offers unique estate planning features including a convenient statutory will option, community property protections, and simplified probate procedures for both small estates and family homes. Whether you’re considering a will or trust, understanding the key differences can save your family significant time, money, and stress while preserving your legacy.
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US Map For The Different Will and Trust Requirements by State
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New Mexico Will Requirements
A New Mexico Last Will and Testament should include:
- Age and Capacity: Testator must be “of sound mind” and at least 18 years old or an emancipated minor
- Sound Mind Definition: Testator understood they were creating a will, had knowledge of the character and extent of the estate, and understood the individuals who would ordinarily have the right to share in the estate
- Format: Must be in writing
- Signature: Must be signed by the testator (or by another person for the testator at the testator’s express direction)
- Witnesses: Must be signed by at least two witnesses
Witness Requirements
For New Mexico wills:
- Witnesses must observe the testator’s signing of the will
- Witnesses must themselves sign the will while in the presence of the testator
- The only statutory requirement is that witnesses be “generally competent” to act as a witness
- While “disinterested” witnesses are preferable, the witnessing of a will by an interested person does not invalidate a New Mexico will or any provision thereof
Self-Proved Wills
Though notarization of a will is not strictly required, a New Mexico will can be made “self-proved” through execution of a notarized affidavit by the testator and the will’s witnesses. When a will is self-proved:
- It can be admitted to probate without witness testimony
- The affidavit can be executed simultaneously with the will or at a later date while the testator and witnesses remain living
- The witnesses and testator attest to the facts necessary to establish the will’s validity
The New Mexico legislature provides a sample form for a self-proved affidavit, at NM Stat. Ann. §45-2-504.
Personal Property Memorandum
New Mexico law allows a testator making a will to incorporate by reference a written statement or list disposing of items of tangible personal property not addressed within the will itself. For the memorandum to be valid:
- It must include the testator’s signature
- It must identify the items of personal property and intended beneficiaries with reasonable certainty
A New Mexico memorandum of personal property can be prepared before or after the will’s execution and can be altered by the testator after the list’s initial creation.
A memorandum of personal property incorporated into a New Mexico will cannot be used to distribute assets not qualifying as “tangible personal property,” such as real estate, and cannot be used to distribute cash.
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Amendment, Revision, and Revocation of New Mexico Wills
Amending a New Mexico Will
Amendment of a New Mexico will can be accomplished through:
- A codicil (a later-executed addendum to an existing will)
- Execution of a new will that includes the desired amendments
In either case, the new will or codicil must satisfy all formalities required for a New Mexico will.
Revoking a New Mexico Will
New Mexico wills can be revoked by:
- A “revocatory act” with the intent to revoke the will (including burning or tearing of the will)
- Execution of a subsequent revocatory instrument which expressly revokes the will and satisfies all formalities for creation of a will
- Execution of a later will that either expressly or implicitly revokes the prior will
Implicit Revocation
A later will is considered to implicitly revoke a prior will if it disposes of substantially all of the testator’s estate.
If a later will does not completely dispose of the testator’s estate, it is presumed to have been intended as a supplement to the earlier will, with the later-executed will controlling in the event of any conflicting provisions.
Automatic Revocation by Divorce
If, after executing a will, a New Mexico testator is divorced, any provisions in the will in favor of the former spouse are deemed to have been revoked unless the will, a court order, or a property settlement agreement between the former spouses expressly states otherwise.
Marriage After Will Execution
If a New Mexico testator marries after execution of 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.
A later-wed spouse’s share is inapplicable if:
- The will was made in contemplation of the marriage
- The testator intended the will to apply notwithstanding the marriage
- The testator made other provisions for the surviving spouse outside the will
Children Born After Will Execution
If a child is born to or adopted by a testator after execution of a New Mexico will—and if the testator did not otherwise provide for or appear to intentionally omit the child—the child inherits a share of the estate:
- If the testator has no other children, the share is equal to what the child would have inherited had the testator died intestate
- If the testator has other children provided for under the will, the share is calculated based upon the devises to other children
An omitted child’s share is inapplicable if the will leaves substantially all of the estate to the child’s other parent.
Holographic and Oral Wills
Holographic Wills
New Mexico law does not recognize handwritten (holographic) wills. A will written in the testator’s handwriting, signed, and attested by two witnesses can be admitted to probate if all formalities required to create a valid New Mexico will are satisfied.
Oral Wills
Oral (or “nuncupative”) wills are not recognized under New Mexico law.
New Mexico Trust Requirements
New Mexico trusts are primarily governed by New Mexico’s Uniform Trust Code, enacted by the legislature at NM Stat. Ann, §§46A-1-101, et. seq.
Requirements for a Valid New Mexico Trust
For a trust to be valid under New Mexico law:
- The purpose of the trust must be lawful, capable of being achieved, and not in conflict with New Mexico public policy
- In general, the terms of a trust and the trust itself must be for the benefit of the trust’s beneficiaries
- The settlor must express an intent to create a trust and have adequate capacity (measured under the same standard applying to wills)
- A New Mexico trust is void to the extent its creation was induced through fraud, duress, or undue influence
Authorized Trust Types
New Mexico’s Uniform Trust Code specifically authorizes, among other things:
- Trusts created for charitable purposes (such as the relief of poverty, advancement of education or religion, or promotion of health, governmental, or municipal purposes)
- Trusts for the care of animals
Required Trust Elements
New Mexico trusts must have:
- A definite beneficiary (subject to exceptions such as for charitable trusts, trusts for the care of animals, and certain trusts created for noncharitable purposes)
- A trustee with actual duties to perform
Sole Trustee/Beneficiary Rule
The sole trustee of a New Mexico trust cannot also be the trust’s sole beneficiary.
Trustee Responsibilities
The trustee of a New Mexico trust has a duty to administer the trust prudently, taking into account the trust’s terms, purposes, and surrounding circumstances.
Trust Creation Methods
New Mexico trusts can be created through:
- Transfer of property by a settlor to a trustee (either during life or through a will or other testamentary instrument)
- A declaration by the owner of property that it is owned as trustee
- Exercising a power of appointment in favor of a trustee
Oral Trusts
Though most trusts are evidenced by a written instrument setting forth the trust’s terms, New Mexico’s Uniform Trust Code recognizes oral trusts if the terms can be established by clear and convincing evidence. Certain types of trusts—such as trusts relating to real estate—must be evidenced by a written instrument.
Revocability
New Mexico law assumes that trusts are revocable unless the terms of the trust expressly provide that the trust is irrevocable.
Automatic Revocation by Divorce
If the testator of a New Mexico revocable trust is divorced after executing the trust instrument, any provisions in favor of the former spouse are deemed revoked unless the trust instrument, a court order, or a pre- or post-nuptial agreement provides otherwise.
Creditor Protection
The general rule is that creditors of a trust’s beneficiary can attach the beneficiary’s interest in the trust. However, New Mexico, like most states, recognizes spendthrift provisions, which help protect trust assets from creditors.
If a New Mexico trust includes a valid spendthrift provision, a beneficiary’s creditors (other than certain domestic support obligations, governmental claims, and claims arising from services provided relating to the beneficiary’s interest in the trust) cannot ordinarily attach trust assets until actually distributed to the beneficiary.
Generally, creditors of a New Mexico trust’s settlor can reach assets held in a revocable trust and can reach assets held in an irrevocable trust to the extent distributions could be made for the settlor’s benefit.
Trust Termination
New Mexico 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 purposes become unlawful, contrary to public policy, or impossible to achieve
A trust may also be modified or terminated:
- By a court upon the petition of the settlor, trustee, and/or beneficiaries
- In some circumstances, upon the consent of the trustee and beneficiaries
Upon petition, a court may also reform or modify the terms of a trust to correct mistakes or accomplish the settlor’s tax objectives.
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Special Considerations
New Mexico Statutory Will
New Mexico’s legislature has adopted a simple “statutory will” that New Mexico testators can use for very simple estates. The statutory will:
- Incorporates default testamentary provisions set forth in the statute
- Has a fill-in-the-blank format
- When properly completed, complies with New Mexico requirements for a valid will
A statutory will form is set forth at NM Stat. Ann. §45-2A-17.
Estate Taxes
No Estate or Inheritance Taxes
New Mexico does not impose either estate or inheritance taxes. Large New Mexico estates may still be liable for federal estate taxes.
Simplified Probate
Transfer by Affidavit
New Mexico allows for transfer of certain estate assets outside probate through the use of an affidavit executed by the individual entitled to receive the asset. An affidavit can be used to transfer:
- Property if the estate value does not exceed $50,000
- A residence owned as community property to the surviving spouse (if the value of the residence does not exceed $500,000)
Small-Estate Probate
A streamlined small-estate probate process is also available for qualifying estates upon approval of the probate court. A New Mexico estate is eligible for small-estate probate if the estate’s value (after deducting liens and encumbrances) is not greater than the sum of:
- Family and personal property allowances
- Administration costs
- Final expenses
- Medical expenses from the decedent’s last illness
Personal representatives of qualifying small estates can take possession of estate assets, make distributions to heirs, and close the estate by affidavit without the more onerous ordinary probate process.
Non-Probate Transfers
New Mexico law provides multiple means of transferring assets outside of the probate process:
Transfer-on-Death Deeds and Vehicle Titles
Transfer-on-Death Deeds
New Mexico law authorizes TOD designations on real estate deeds (sometimes called a “beneficiary deed”). When a TOD deed is recorded, the property automatically transfers to the named beneficiary upon the owner’s death, but the beneficiary does not acquire present rights in the property until death actually occurs.
Vehicle Titles
New Mexico does not permit TOD designations on vehicle titles.
Need help creating the right estate plan for your New Mexico family?
Our estate planning specialists can help you navigate New Mexico’s unique laws and create a personalized strategy.
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 |
| New Mexico Special Feature | Statutory will form available for simple estates | Can be created orally if terms can be clearly established |
Conclusion
Creating a will or trust does not have to be difficult or intimidating for New Mexico 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.
New Mexico offers unique estate planning tools like the statutory will form for simple estates, transfer-on-death deeds for real estate, and simplified probate procedures for both small estates and family homes. The state’s community property laws also provide natural protection for surviving spouses. When any out-of-the-ordinary issues are present, it’s advisable to consult with an experienced attorney familiar with and licensed under New Mexico law to ensure your estate plan takes full advantage of the state’s provisions while avoiding potential pitfalls.
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- ✓ Protect assets during incapacity
- ✓ Create safeguards for children and loved ones
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FAQs: New Mexico Wills and Trusts
Q: What are the requirements for a valid will in New Mexico?
A: A New Mexico will must be written, signed by the testator (18+ or emancipated, of sound mind), and witnessed by at least two generally competent people who sign in the testator’s presence.
Q: What is the New Mexico statutory will, and who can use it?
A: It’s a simple, fill-in-the-blank will form provided by the state (NM Stat. Ann. §45-2A-17) for basic estates. Anyone meeting will requirements can use it if their estate is straightforward.
Q: How do wills and trusts differ in New Mexico regarding probate?
A: Wills require probate, a public court process, while trusts (especially living trusts) avoid probate, offering privacy and faster asset distribution.
Q: What are transfer-on-death (TOD) deeds in New Mexico, and what can they cover?
A: TOD deeds allow real estate to pass to a beneficiary upon death without probate. New Mexico authorizes them for real property but not vehicle titles.
Q: How does community property affect spousal inheritance in New Mexico?
A: One-half of community property automatically belongs to the surviving spouse. Without a will, they also get all separate property if no kids exist, or one-fourth if there are children.
Q: Can I avoid probate for a small estate in New Mexico?
A: Yes, estates under $50,000 can use a transfer affidavit, and homes up to $500,000 owned as community property can pass to a spouse. Small-estate probate is also an option for qualifying estates.
