Inheritance Disputes & Rights

There are several methods available to leave assets to loved ones at the time of death:  A will, a trust, payable on death designations, life insurance policy beneficiary designations and qualified plan (IRA, 401(k), etc.) beneficiary designations.  Contrary to public belief, there is no specific “right” to inherit from a parent if their estate is intentionally planned to exclude a child (children).  In Texas, there is no legal obligation to leave any property to one’s children at the time of death.  However, in the vast majority of estate plans, the children are the beneficiaries, whether as an outright gift at the time of death or to have their gift held in trust.

You Have Rights.
We Enforce Them.

Who really gets what?

If a person makes a Will that says “I leave, unconditionally, absolutely everything I own, including real property, personal property and all other property in which I have any interest whatsoever at the time of my death in equal shares among my three children.”  He then creates a beneficiary designation for both life insurance and retirement plan benefits at his place of employment, designating his new spouse as his 100% beneficiary.  Six months later, he creates a “living trust” into which he transfers his home, all personal property and financial assets (excluding his IRA and qualified retirement plan benefits disposed of in accordance with the previous sentence).   The death time beneficiaries of his trust are: 50% to his new wife and 50% to a charity.

Forcefully – Strategically – Efficiently Resolving Probate, Trust, and Estate Disputes

Is this fair?

In the above example, even though his Will states that it leaves absolutely everything he has to the beneficiaries named in the Will, the Will controls only property that is considered to be “probate property”.  Assets that can be transferred at the time of death pursuant to a beneficiary designation will be paid directly to that named beneficiary and will not be controlled by the terms of the person’s Will.  The same is true for life insurance policy designations and other financial institution payable on death beneficiary designations.   Individuals who, because they are named as beneficiaries in a parent’s Will and think their inheritance is secure, are often surprised when beneficiary designations from retirement plan benefits, life insurance and payable on death provisions at banks and financial institutions as well as provisions in a living trust, control a decedent’s property and can leave the beneficiaries of a Will with virtually nothing as of the time of the loved one’s death.

INHERITANCE DISPUTES & RIGHTS

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