Estate Planning Mistakes That Cause Problems in Arizona Part 2

Picking up from Part I of this article, common mistakes made during Estate Planning, we wanted to highlight a few more errors that can happen when preparing for estate planning. This easily happens when trying to navigate these waters without professional guidance from an experienced estate planning attorney.

Choosing the Wrong Personal Representative or Trustee

Arizona allows out‑of‑state personal representatives/executors, but they must appoint a local agent for service of process. This adds complexity. Many people choose someone who:

• Lives far away
• Is unfamiliar with Arizona law
• Cannot manage financial or legal responsibilities
• Lives in a higher income tax state and now makes the estate or trust subject to that state’s income tax laws as well.

On the other hand, a capable, organized, and local personal representative prevents delays, decreases costs, complexities and added tax burdens.

Ignoring Digital Assets and Online Accounts

Arizona has adopted the Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA), which governs how executors access:

• Email
• Social media
• Online banking
• Cryptocurrency
• Cloud storage

If you do not provide clear instructions, your executor may be unable to access important information or assets. Addressing digital assets is crucial to your personal representative or agent under a power of attorney being able to access these accounts.

Underestimating Arizona Tax and Property Considerations

Arizona does not have a state estate or inheritance tax, but tax issues still arise:

• Capital‑gains taxes when heirs sell appreciated property
• Community‑property “double step‑up” rules that can reduce taxes if assets are titled correctly
• Income taxes on retirement accounts left to beneficiaries

Poor planning can increase the tax burden on heirs unnecessarily. And the biggest issue I see is appointing a personal representative in a high-income tax state and now the trust or estate is subject to that state’s taxes even though none of the assets are located there.  An estate or trust is deemed to be situated in the state where the trustee or personal representative resides. This not only increases the tax burden but also requires at least 2 state tax returns to be prepared on top of the federal income tax.

Lack of Communication with Family Members

Even a well‑crafted plan can cause conflict if:

• No one knows where documents are stored
• Beneficiaries are surprised by decisions
• Agents or Personal Representatives are unprepared for their responsibilities and delay allowing other bad actors to interfere.

Arizona families often face disputes over real estate, especially when multiple heirs inherit a home and disagree on whether to sell or keep it.

Using DIY Documents That Don’t Meet Arizona Requirements

Online templates rarely address:

• Your family’s unique situation
• Community‑property nuances
• Mental‑health power of attorney requirements
• Proper trust funding for Arizona real estate
• State‑specific witnessing and notarization rules

A plan that looks complete on paper may fail when it’s needed most.

How We Can Help

At Tritch Buonocore Law, estate planning, asset protection, and trusts are just the beginning. We are committed to giving you true peace of mind through clear guidance and a full understanding of your options. Our goal is to make the process simple, approachable, and stress-free, so you can focus on your spouse, your family, and the adventures ahead.

We hope these explanations and the checklist for common mistakes can help you know what to expect when estate planning. At our firm we aim to prepare our clients with careful planning and experienced advice. This can help you avoid last-minute scrambles for an estate plan. At Tritch Buonocore Law, we don’t just help you navigate estate planning, we give you peace of mind to fully understand and prepare for your future. That’s why we simplify the entire process, making it as seamless and stress-free as possible, so you can focus on enjoying the years ahead.

We welcome new clients with a 30-minute meet-and-greet consultation. Reach out at (480) 525-6244, email us, or visit our website whenever you’re ready.