Family Disputes over Inheritance
When family disputes over inheritance arise it can quickly escalate into irreparable damage. Emotions are already running high when a loved one dies. Incidents that could easily be worked out under normal circumstances are magnified during periods of grief.
Family disputes over inheritance often occur when a relative dies without executing a Will. However, when a person dies intestate the estate must be settled according to state probate laws. Heirs can file claims against the estate if they have evidence they are entitled to specific property. They can fight all day over who should receive what, but if a Will is not in place there isn't much they can do about distribution of property.
The biggest contender for fights is when heirs disagree over directives provided in the last will and testament. When heirs feel slighted or believe they should have received specific property owned by the decedent, they have the right to contest the Will. Unfortunately, this act only adds fuel to the fire and is costly for both heirs and the estate.
Heirs that contest Wills are responsible for legal expenses until the judge rules in their favor. When heirs win the lawsuit the estate is usually required to reimburse heirs' legal fees. These costs are in addition to defense counsel.
Contesting the Will can suspend probate for months on end. This is particularly damaging to small estates because legal fees can force estate administrators to sell inheritance property. When property is sold to cover legal expenses, designated heirs lose out on property gifted to them through the Will.
While there is no ironclad way to prevent heirs from entering into inheritance war, individuals can engage in estate planning strategies to minimize the possibility. No one wants to think about their loved ones arguing over their personal belongings after they are gone, but it happens all the time. Even families that get along well can behave abnormally when grieving.
Estate planning is critical when family members frequently end up feuding. Death has a tendency to bring out the best and worst in people. As a probate liquidator, I have witnessed families enter into full throttle battle over a piece of jewelry. Those who think it won't happen are fooling their self.
One way to minimize family feuds is to hold a family meeting and openly discuss who wants what. If this isn't feasible, consider talking to each family member privately. Create a list of most-wanted items for each person and bequeath those gifts within the Will.
Those who believe an heir might contest the Will can include a no-contest clause. This clause states that heirs who contest the Will lose their right to any inheritance gifts.
When family members have disassociated and you want to disinherit them, it is crucial to include a disinheritance clause. Disinheriting direct lineage heirs is not an easy decision, but there are times when it needs to be done. The Will must include specific reasons as to why the heir is not entitled to inheritance property. This does not prevent heirs from contesting the Will, but can minimize the risk.
Estate assets can also be protected by transferring property to a trust. Several types of trusts exist, so it is best to consult with a probate attorney to determine which one offer the most protection. Trusts are beneficial to estates valued over $100,000 and are used to protect assets from inheritance tax.
Engaging in estate planning offers multiple benefits. Not only does it help reduce potential for family feuds to erupt, it can also minimize taxation and prevent certain assets from undergoing the probate process.
We invite you to learn more about estate planning, trusts, inheritance and estate taxes in our estate management article library. Topics include tips for hiring a probate lawyer, ways to avoid probate, and strategies to minimize family disputes over inheritance.
Published on April 19, 2011 at 03:21 AM
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