http://www.marylandtaxes.com/publications/bulletins/it/default.asp

Raymr,

First, I'm not a lawyer and I am not familiar with Maryland law.

You didn't mention whether your stepmother has children of her own. Second marraiges can really muddy estate planning waters... and make post death fights more likely iif not addressed beforehand.

I have a client whose husband passed away and left her a life estate in his interest in their marital home. She and his credit shelter trust each now own 50%.
At the time of his death, the property was owned by them as TENANTS IN COMMON. This allowed him to bequest his half to his children by use of the trust. She gets to live in the house until she dies. During her lifetime, she is responsible for all taxes, which now are a cool $12,000 per year! I am not sure if there is an abondonment clause if she leaves, but she owns no other property, so as long as she is able to, she will remain there.

If your father and stepmother hold title as Tenants by the entirety or Joint Tenants with rights of survivorship, the house will likely pass automatically to your stepmother. This is done through the operation of law and not by will. You should ask a MD attorney how to have the title held prior to death to make sure that Dad's children keep their rights in 75% of the value.
In NJ, TIC is the only way to do that. Otherwise, it would go to her automatically. Don't mess this up!

Another question is: Did your stepmother legally adopt you and your siblings?
State inheritance tax law may not consider you as her children if you are not legally adopted.

I see MD has an estate tax exemption of 1,000,000, half of the two million the Federal Govt. provides for 2006-2008. Be aware of that if you are considering a credit shelter trusts to save death taxes.

Sorry about your father. My best wishes to you.


Post script: If your lawyer is antsy, he's antsy about his estate planning skills.
Maybe he's not the best one to be handling this. Also, I assume he is drafting BOTH wills with full and open disclosure to both parties??? If not, I'd be concerned.