Estimated Reading Time: 8 minutes
Table of Contents:
- Outdated Documents That No Longer Work Under Current Law
- Beneficiary Designations That Override the Estate Plan
- Blended Families & Conflicting Expectations
- Administrative Delays & Bottlenecks
- Digital Assets That Do Not Fit Traditional Documents
- Incapacity Documents That Are Missing or Incomplete
- Home Equity & Liquidity Problems Among Older Homeowners
- Misunderstanding State-Level Taxes
Estate planning seems straightforward from the outside, but the process becomes more complex once laws and assets interact. A single outdated document or overlooked account can change how property transfers, who gains control, or whether an estate faces taxes that could have been avoided.
Understanding the most common challenges helps families spot these issues early and avoid problems that tend to surface at the worst possible time.
Outdated Documents That No Longer Work Under Current Law
Many families hold wills or powers of attorney prepared years earlier. Some never signed the final drafts, while others hold documents that predate important legal changes in Maryland and D.C.
A common issue involves documents that lack language required under the Revised Uniform Fiduciary Access to Digital Assets Act. Without that language, loved ones can’t gain access to important online accounts, cloud storage, electronic financial statements, or digital records that now carry significant personal and financial value. Older powers of attorney may also be rejected by banks, investment firms, or medical providers if the forms do not meet current standards.
Other outdated documents reflect family structures that have shifted. A guardian named when a child was young may no longer be the right person. Beneficiaries listed years ago may no longer match a family’s priorities. Trusts prepared under outdated tax rules often fail to take advantage of planning options available today.
Beneficiary Designations That Override the Estate Plan
Washington, D.C. and Maryland are home to one of the largest concentrations of federal employees and military retirees in the country. These workers often have employer-controlled assets such as TSP accounts, FEGLI life insurance, and federal pensions. These assets rely on beneficiary forms that override wills, trusts, and other estate documents.
A will may lay out a detailed distribution plan, but asset custodians follow the beneficiary designation on file. Many federal employees fill out these forms early in their careers, then forget about them. A former spouse, outdated contingent beneficiary, or deceased relative may remain listed for decades. The same issues show up with private retirement accounts, employer-sponsored life insurance, and older brokerage accounts.
Correcting the disconnect between beneficiary forms and estate documents requires a coordinated review of both the estate plan and the titling of every account, which is a step families rarely complete without guidance.
Blended Families & Conflicting Expectations
Many households in the region include second marriages, cohabiting partners, stepchildren, and extended relatives who play central roles in care and support. These structures create challenges when state laws do not match a family’s expectations.
Children from a prior relationship may expect to inherit specific property. A surviving spouse may anticipate full access to the marital home. An unmarried partner may rely on shared property or financial support that intestacy laws do not provide. When documents do not address these issues clearly, conflict becomes likely and legal outcomes rarely mirror what the family intended.
Trust-based planning often becomes the only reliable method to balance these competing expectations. A trust can give a surviving spouse lifetime housing while ensuring the property ultimately passes to the children. Without such planning, the law applies a one-size-fits-all approach that does not fit most blended families.
Administrative Delays & Bottlenecks
Probate has become increasingly slow. Estate filings continue to face backlogs that delay access to funds and extend the time families need to settle financial obligations. Even simple estates can encounter hurdles when the Register of Wills requires additional documentation or moves cases through a long review queue.
Many local families turn to revocable living trusts to avoid probate altogether. A trust can remove the bulk of an estate from court supervision, but the structure works only if assets are retitled properly. Funding a trust requires transferring accounts, deeds, and policies, and this step is frequently overlooked. When a trust is technically in place but unfunded, families find themselves routed back into probate, losing the benefit they expected.
Digital Assets That Do Not Fit Traditional Documents
Digital assets present new challenges that traditional estate planning documents were never designed to handle. Online bank statements, insurance portals, personal photographs, cryptocurrency, and business platforms now hold substantial value. Without express legal permission, technology companies often deny access to these accounts, even when an executor presents a death certificate.
Cryptocurrency introduces additional risk. A seed phrase or private key is the only path to recover those assets. If that information is lost or not passed along safely, the value often disappears permanently. Storing access information inside a will is also unsafe because wills become public record. That tension requires a planning approach that blends legal authority with secure off-document asset management.
Incapacity Documents That Are Missing or Incomplete
A large percentage of the problems families encounter relate not to what happens after death, but to what happens during illness or cognitive decline. Financial powers of attorney, medical powers of attorney, and advance directives determine who can act during a crisis. Without these documents, families may need to petition the court for guardianship, which introduces cost, delay, and loss of privacy.
Single adults face particular vulnerability. Unmarried partners, close friends, and chosen family members have no automatic authority under Maryland or D.C. law. Decisions fall to next of kin unless legal documents name someone else. Many people underestimate how quickly incapacity can arise and how limited the options become once it does.
Home Equity & Liquidity Problems Among Older Homeowners
A large percentage of Maryland and D.C. homeowners carry most of their net worth in real estate. Rising home values have pushed many families into the taxable range for state estate taxes while leaving them short on liquid assets. When an estate owes tax or probate expenses, the lack of available cash pressures families to sell property, even when their goal is to keep the home in the family.
This issue becomes more pronounced for older residents who plan to age in place. The home becomes the central asset and, without proper planning, the target of Medicaid estate recovery after long-term care. Families often misunderstand how Medicaid recovery works. Many believe a will can shield the home or that leaving it to children prevents recovery. Recovery programs operate independently of a will, and by the time families recognize the rules, eligibility windows and planning options may have already passed.
Misunderstanding State-Level Taxes
Many people hear about the high federal estate tax exemption and assume their estates face no tax risk at all. That assumption works at the federal level but not at the state level. Maryland’s exemption is around $5 million, and Washington, D.C.’s is slightly lower. The two jurisdictions also apply their rules differently.
Because the federal exemption sits far higher, families often compare their estate to the federal number and stop there. State thresholds fall below the value of many local estates once home equity, retirement accounts, and life insurance are added together. A house in Montgomery County or Northwest D.C. can account for a large portion of that total on its own. Maryland’s inheritance tax, which applies when assets pass to certain family members or friends, adds an extra obligation many people are not aware of.
A large group of households in the region ends up in a middle category: not wealthy enough for federal estate tax, but well within the range for Maryland or D.C. taxes. Families usually discover this only after someone passes away, when the options to reduce or avoid state tax are limited.
How Law Offices of Thomas Stahl Helps Families Address These Challenges
Effective estate planning requires more than preparing a set of documents. Families in Maryland and D.C. need support that accounts for local tax structures, federal benefit systems, modern digital assets, and the region’s changing family dynamics.
Our approach focuses on giving families a complete and accurate picture of their estate, not just a set of documents. Planning begins with understanding how assets are owned, how beneficiary rules operate, and how Maryland and D.C. laws treat tax exposure, incapacity, and probate. From there, we help clients build a plan that accounts for federal benefits, real estate, digital assets, and the needs of modern families. The goal is to create a structure that functions smoothly when it is needed, avoids preventable conflict, and protects the people and property at the center of the plan.
If you want guidance that reflects your situation, your assets, and the rules that apply where you live, our team can help you build a plan that supports your goals and holds up when it matters most. Reach out online or call (443) 300-9208 to schedule a consultation.
Disclaimer: The material in this article is intended for general informational purposes and should not be relied on as legal advice. Estate planning outcomes depend on many personal and legal factors that vary from one individual or family to the next. Anyone considering an estate plan should speak with a licensed attorney who can review their specific circumstances. Reading this article does not create an attorney–client relationship with Law Offices of Thomas Stahl.