Your legally adopted children in Iowa would probably enjoy most of the same protections under the state’s inheritance laws as would your biological children. However, there could be some concerns you may want to address during or immediately following the adoption process.
In fact, some of these points may become helpful following the birth of a child. Some families are not completely served by the default rules of inheritance in Iowa, so you may want to consider the unique elements of your own case.
One common concern adoptive parents have is the impact of the inheritance tax. As explained on the Iowa Department of Revenue website, transfers to lineal descendants would probably be exempt from the tax. This would include all biological and legally adopted children, grandchildren and great-grandchildren.
However, these default rules, well they could protect your adopted children, would probably not be the most efficient way to distribute your estate. For many families, especially those with a mix of adoptive and biological children, establishing trusts as part of a comprehensive estate plan may be more desirable. These financial tools could allow funds to bypass the probate process.
Another option available to you might be life insurance policies. These assets could provide some financial stability for your heirs and, unlike trusts and wills, life insurance could be maintained without a large capital investment. This is an attribute that could make these policies desirable for estates without a high proportion of assets. For example, a young professional without significant retirement accounts or real estate equity could take out a life insurance policy to help heirs manage debts or pay for significant life expenses.
As you can see, there are many different types of estate planning tools you may be able to use to protect the future of your adoptive child. Determining the ones that work for you would probably require an in-depth review of your financial and family situation. Please do not regard this specific legal advice for any real situation. It is only meant as a general background.