If you're worried about leaving gifts in your will to a family member this might help.
Problem Heirs – I Want To Do My Estate Plan, But It’s Not That Simple
by Julie O'Brien on September 10, 2009
Most of us are aware of the need to have a good estate plan to pass on our assets at our death. Yet this important task is often postponed. Because of the importance of such a plan, we want it to be perfect. Sometimes our hesitancy to go ahead and make a plan is rooted in ambivalent or possibly even negative feelings about one or more of our heirs – a child or grandchild who would normally be a beneficiary of our assets. Often we love these people and want them to have our assets, yet very real concerns paralyze us and keep us from moving forward. The resulting lack of moving forward penalizes others about whom we care and prevents us from having the peace of mind that comes with having designed a satisfactory estate plan.
An experienced estate planning attorney has an arsenal of tools to address such concerns. An estate plan will be our last message to our heirs, and we want it to resonate through the years with our values. On the one hand, we don’t want it to be driven by disappointments and worries that may or may not be temporary. On the other hand, neither do we want our decisions to be based on possibly unrealistic hopes that our heirs will “straighten up” after we die.
Common concerns and some possible solutions include:
- “My daughter takes money for granted.”
Your estate plan can include a trust, providing for distributions to heirs at specific times or at specific ages. A trustee will be appointed – someone you know and feel comfortable with or even a professional – who can be objective and fair in the management of undistributed funds for further growth. You may grant the trustee a great deal of discretion – or very little discretion – in the making of decisions.
- “My son does not recognize the limits of his inheritance. I am concerned that he might sell or give away his inheritance rights.”
A “spendthrift” provision can and should be part of your estate plan. Such a provision keeps an imprudent heir from transferring his interest in your estate to another. Such a provision also safeguards estate assets from claims other parties may have against your heir for debts incurred.
- “I disapprove of my children right now, so I wish to leave everything to my grandkids instead.”
An experienced attorney can assist you in avoidance of payment of federal generation-skipping transfer tax, if necessary, and provide counsel in other potential pitfalls of choosing to bypass one generation in favor of another.
- “My daughter suffers from physical and/or mental disabilities, and it is unlikely that she will ever be able to manage her own affairs.”
A Special Needs Trust can provide for the future needs of a disabled child, while still allowing the child to take advantage of state and federal benefits. You will not have to deplete your assets to fund such a trust.
- “I’ve given up all hope of my son ever recovering from his alcoholism/drug abuse.”
Your estate plan can be crafted to leave an impaired heir’s usual share to a treatment plan, a rehab center, or a non-profit organization instead of directly to the heir. In this way, you are addressing the problem directly, leaving the assets to a worthy cause, and in a wonderful way honoring your impaired heir by recognizing the struggle in which he is involved. For example, if a parent is a member of Al-Anon (the organization for those whose lives have been affected by someone else’ drinking or drug use), a bequest can be made to that organization.
- “My daughter is married to (or is likely to marry) someone I do not trust, so I don’t want to leave anything to her.”
Washington law does create a presumption that assets belong to a couple through what is known as community property law. However, bequests to one marital partner are not community property if they are kept separate. This can be assured by placing the assets in trust for that person. An attorney can counsel you as to how to avoid assets becoming community property.
- “I have some items of personal property which have special meaning to me, and I want certain people to have them. I don’t want these items to be possibly mingled by my child with my general estate.”
Washington law allows for items of personal property to be transferred through a list, which is included by reference into your will or trust. You can maintain the list yourself without the formalities necessary to revise your will or make a new will. You can change your mind and can even add items you may not yet own.
Should any of the above scenarios seem familiar to you, The Meyer Law Firm can assist you. We have the experience, sensitivity, and creativity necessary to address your particular concerns. We can provide you with a perspective of your entire estate situation, including heirs you may have in addition to the “problem” heir. We have knowledge of the law and the various alternatives available, and can draft documents based on the informed choices you make. Achievement of such a plan assures you that you have faced the realities and proceeded forward to design a plan. That plan will reflect your personal values and be in your best interest and consider the interests of all those about whom you care – including but not limited to the “problem” heir. If you would like to discuss such an estate plan, give The Meyer Law Firm, P.C. a call 425.455.1002 to set an appointment to review your situation.