State Laws Limit Americans' Estate Planning Abilities During the Coronavirus

The coronavirus pandemic was once concentrated in large cities, including Seattle and New York, but as the virus creeps further into every state in the U.S., people are beginning to think more about what to do if they become infected.

And for many people, that includes thinking about estate planning.

"You start asking yourself, what happens if I become sick?" says Jack Garniewski, president of the National Association of Estate Planners and Councils. "Do I have the proper legal documents in place so that someone would be able to make decisions for me financially and from a medical standpoint?"

Garniewski says that since the start of the COVID-19 outbreak, more Americans are making sure they have a durable power of attorney -- enabling another person to make financial decisions for them if they are incapacitated -- and they are planning how their property will be transferred should something happen to them.

Documents tied to estate planning, including a durable power of attorney, health care power of attorney and wills often require notarization, depending on the state, and some also require witnesses. Historically, the notarization process takes place in person -- but at a time when many state governments are asking residents not to leave their homes except for emergencies, this in-person method no longer works.

Some states already allow remote online notarization for some of these documents, and others have made their related laws around this more flexible during the pandemic, while other states do not allow individuals to get certain documents notarized remotely.

According to Charlottesville, Virginia-based law firm McGuireWoods, some states, such as Florida, Idaho, Minnesota and Virginia, allow notaries to provide their services through remote online notarization, and some states have done so for years.

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In Vermont, Indiana and North Dakota, there are statutes for remote online notarization, but these statutes were never enacted. Arizona, Maryland, Iowa, Nebraska and Wisconsin have enacted these laws, but they have yet to go into effect. Most of these states have released temporary guidance on options for remote online notarization during the outbreak, according to McGuireWoods.

Alabama, Arkansas, Colorado, Connecticut, Illinois, Michigan, Missouri, New York, New Hampshire, New Mexico, Texas, Washington and Wyoming have passed executive orders or legislation related to remote online notarization since the outbreak began, the firm notes on its website.

But Jeffrey Katz, managing partner at JDKatz Attorneys at Law in Bethesda, Maryland, says he doesn't know if state laws are evolving as quickly as the pandemic.

Katz, whose office's phone has been "ringing off the hook," says Maryland still doesn't allow witnesses to participate remotely, for example. This means that, if a document requires witnesses, those witnesses must be physically present with that person when they sign the document.

Andrea Chomakos, a partner at McGuireWoods, says that wills almost universally require two witnesses in the U.S. and that a health care power of attorney document generally requires two witnesses that are not related to the individual. This poses a major issue since many Americans are only surrounded by family, if anyone, while they practice social distancing.

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Katz also points out that some companies that provide online notarization services are charging $20 or $30 per notarization, which can add up quickly with multiple documents.

In North Carolina, where Chomakos' office is located, the state doesn't allow remote online notarization. As a result, Chomakos said she had two situations last week where she had to be creative in how to serve her clients who wanted to sign their wills. North Carolina states that an individual can transcribe their will in their own handwriting and sign it without needing witnesses or notarization, Chomakos says. Therefore, the clients could handwrite and sign the wills Chomakos sent them.

In some states, such as Virginia, there are strong remote online notarization laws, but those statutes don't apply to all documents tied to estate planning, including wills, according to Tim Reiniger, the principal author of the country's first remote notarization law, enacted in Virginia in 2011. That poses an issue for couples like Julie Peasley, 44, and her husband, Louis, who would like to get their will finished now "in case we have any problems," she says.

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Peasley says she and her husband were in the last steps of completing their wills when the coronavirus hit the U.S. The Springfield, Virginia, couple had been stalling on completing the final steps of the process, but she says the pandemic increased their sense of urgency to ensure their teenage son would be protected if something happened to them. But without a remote notarization option, the couple is struggling to figure out how to get their documents notarized.

Though states differ now in their regulations related to online notarization, Reiniger says he's providing support now for a federal bill that would authorize notaries all over the country to perform remote online notarizations. States will then decide how to apply that law to the use of witnesses and certain documents such as wills, he explains.

"When we wrote the first online notary law in Virginia, we had no idea that there would be as much interest as there is now, and we find it very exciting," Reiniger says.

Even with states' evolving laws, some are concerned that documents notarized remotely could be litigated following the coronavirus pandemic. If an individual signs estate planning documents under these pandemic conditions and they pass away, someone might challenge the documents and question the effectiveness of these remote online procedures, Chomakos explains.

Chomakos adds that the flood of Americans who are racing to get estate planning documents signed during COVID-19 places a great deal of stress on offices that deal with estate planning as they work to fulfill clients' requests while following safety guidelines. Many people who have put off their estate planning documents now have a sense of urgency, she says.

"It reiterates that these are incredibly important matters," Chomakos says.

Casey Leins is a staff writer for the Best States section of U.S. News & World Report, where she writes about innovative solutions to problems plaguing the states. She came to U.S. News as an intern in 2014, joined the News team as a web producer in 2015, and was part of the team that launched the first Best States ranking in 2017. She was selected to attend the McCormick Specialized Reporting Institute workshop held by the Poynter Institute in 2017, and previously worked as a writer for the University of Maryland's Robert H. Smith School of Business and the Howard County Times. She is a graduate of the University of Maryland, College Park. Follow her on Twitter, connect with her on LinkedIn or email her at cleins@usnews.com.