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Featured in Cherry Creek Living Magazine – Volume 1, Issue 6

In the past couple of months, our column has examined some of the issues to consider when preparing an estate plan. We have pointed out potential pitfalls and offered a myriad of reason to consult an experienced estate planning attorney.  Some of the issues we have discussed include making decisions regarding distributing property to your heirs, tax planning, specific considerations with respect to end of life decisions and designating agents to control health care and financial decisions should you be unable to make those decisions yourself. We have only scratched the surface with respect to all of the reasons it is important to have a comprehensive and well thought-out estate plan.  As you navigate the estate planning waters, you will also find that there are many hidden issues which, without proper guidance from an experienced attorney, too often come to light for the family once a person is deceased and has  overlooked certain issues in their estate planning.

One of those “hidden” issues is the ownership structure of cemetery plots regardless of whether the plot is in the ground, in a crypt or some other type of purchased right such as scatter rights. Many are confused by what they actually own when purchasing a cemetery plot. Others find difficulty in utilizing that plot the decedent or family holds when it has been passed down through many generations of estates. The ownership chain becomes substantially fractionalized and unclear.

In combating these problems, the first important issue is to clearly understand what you own when you purchase a cemetery plot. The purchase of a plot does not transfer to the purchaser any title or interest in the land or in a crypt space. The Cemetery will continue to own the land and crypt at all times. When you purchase a plot or crypt, you are simply purchasing the privilege of burial or entombment within the cemetery. One easy way to understand this is to remember that you are not paying property taxes on the land. If you actually had ownership in the land, you can bet you would receive a tax bill from the appropriate government authorities.

Despite the fact that the owner of a plot does not own title or any other interest in the underlying land, there are too often problems with the chain of ownership for the rights to the plot. Under existing law, if the owner of a cemetery plot dies without making an outright disposition of the plot in his or her will, the interest in the plot often becomes fractionalized. Under the terms of many wills, the plot will be distributed to many heirs in varying shares based on the terms of each will. If there is no will, the state will step in and distribute the plot under the laws of intestate succession. What the heck does all of that mean? Very simply, under Colorado law, if the rights in the plot are not devised to one specific person, the plot often gets divided equally among multiple heirs. The worst case scenario is when the decedent holds one unused plot, following their burial, and that unused plot is now controlled equally by multiple heirs. Sound like a potential mess? It is! Imagine the poor folks at the cemetery being on the receiving end of multiple family members trying to determine who will actually get to use the plot, or have the right to decide who gets to use the plot. They all own some share in the plot, so they all have a say, right?

How do you avoid a mess such as this? Very simply, transfer the ownership in the plot to a trusted friend or family member in advance of your death. The next best recommendation is to devise the plot to one specific person in your will. What if I don’t have a will – many of you ask– then you are back to the very likely scenario of fractionalized ownership in the plot.

There is a mechanism for the heirs to transfer ownership after the decedent passes, but it requires the agreement of all the heirs. I am sure you can imagine just as many scenarios where this might be impossible. The mechanism is called an “Affidavit of Heirs,” and it is incumbent upon the heirs of the “original owner” to settle the estate and execute a sufficient affidavit delineating who now owns the rights to the plot. Sounds simple, but you know as well as we do that families don’t always agree. Will your family agree? Do you have a plot that you want to ensure is protected through proper planning?