Family Disputes over Property
Family disputes over property often arise during the probate process. While most of us would like to believe our loved ones will be accepting of directives provided in our last will and testament, there are times when fights break out when heirs feel slighted or have been disinherited from the Will.
As a probate liquidator, I've witnessed more family disputes over property than I care to admit. When people are grieving they experience a wide range of emotions. If a relative bequeathed real estate to a sibling rival or donated large sums of money to a charity, it can be sufficient fuel for heirs to contest the Will.
Engaging in estate planning can minimize risks for family disputes over inheritance property. One option is to include a no-contest clause within the last will and testament. Essentially, this clause states that heirs who contest the Will forfeit their rights to inheritance.
The problem with non-contest clauses is if heirs proceed with the lawsuit and win, the estate is divided under intestate probate laws. This means that the court distributes estate assets to rightful heirs as if the Will had never been executed.
It's never fun for loved ones to endure courtroom battles while in the midst of grieving the loss of a loved one. Individuals who decide to disinherit relatives or include non-contest clauses should consider bequeathing a sufficient sum of money or inheritance property to dissuade heirs from contesting in the first place.
Another way to minimize risk of heirs from contesting a Will is to appoint a probate lawyer to the position of personal representative. The estate is responsible for monetary compensation to representatives handling estate settlement procedures. While it is more costly to pay a lawyer, doing so can save money when chances are high for having the Will contested.
Oftentimes, individuals designate family members as the probate personal representative. If family strife exists, this position can place relatives in the firing line. While settling decedent estates is a time-consuming and emotional process, family members often have hurt feelings that they weren't selected.
This can lead to feelings of anger or jealousy and cause people to act out by feuding over inheritance money. It is not uncommon for families to fall apart when a loved one dies, particularly when it's a parent or older person who has been the family matriarch.
When the glue that holds the family together is gone, people feel lost and angry. It can take very little to provoke them into filing a lawsuit against the estate. Contesting a Will can easily bankrupt small estates to cover costs of defense legal fees. It's not uncommon for personal representatives to be forced to sell inheritance gifts to cover lawyer fees.
Contesting a will also suspends assets in probate for long periods of time. Everyone knows the justice system is a slow-moving process. When estate assets are suspended in probate they often depreciate in value; however, heirs are required to pay inheritance tax on the value of the property at the time of death.
The only ironclad way to prevent family disputes over property is to distribute belongings and inheritance money while you're still alive. People who have been diagnosed with terminal illness often use this strategy to minimize estate tax and to ensure their loved ones receive the gifts they want them to have.
If family dysfunction is running rampant in your family it is strongly recommended to retain services from a probate lawyer to determine strategies to prevent family arguments. It can be advantageous to research estate planning strategies to determine which is best suited for your family dynamics.
We have provided numerous estate planning articles in our probate and inheritance article library. Here you'll find tips for hiring a probate lawyer, designating a personal representative, ways to avoid probate, and how to establish a trust for asset protection.