Heirs understanding the transfer of the estate.
The word 'heir' dates back to the 13th century and is derived from the Latin words, hered and heres. These two words are related to the Greek word, chēros, meaning 'bereaved' or 'suffering the death of a loved one'.
Heir can be used to describe a person who either inherits property or is entitled to inherit property. It is also used to describe a person who is entitled to fulfill a specific role, such as an heir to a business or estate. Last, but not least, heir describes an individual who receives a gift or donation or particular quality from a parent or ancestor.
Property is typically left to heirs through a Will or living trust. There are two types of property which can be gifted through a Will - specific gifts and general gifts. Specific gifts include items such as an engagement ring, heirlooms, coins, stamps, etc.
General gifts are the items which remain after the smaller, specific gifts are distributed. General gifts typically consist of the bulk of the estate. Individuals who receive general gifts are known as "principal heirs". Every Will must list at least one principal heir.
There are certain types of property which are not distributed to heirs through a Will. These include: life insurance, retirement plans, payable-on-death bank accounts and real estate held in Joint Tenancy or Community Property.
Inheritance tax is currently undergoing a phase-out process and will completely eliminated in 2010. However, heirs will be subject to both gift and capital gains taxes. Individuals who are classified as heirs would be wise to consult with an attorney who specializes in Inheritance Tax due to the complexities of the laws.
Published on February 13, 2008 at 10:58 PM
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