Almost everyone has inherited personal property or cash from a deceased relative. Receiving inheritance gifts is usually a bittersweet experience because it means a loved one is no longer around. One the other hand inheritance gifts can completely change a person’s life.
There are times when inherited gifts cause more problems than their worth. As a probate liquidator, I have watched far too many inheritance wars break out between relatives. I’ve also witnessed the heartbreak when estate agents are forced to liquidate assets in order to pay debts owed by the decedent or cover the cost of legal fees when heirs contest the Will.
Regrettably, a myriad of issues can come up with estate settlement proceedings. The best way to reduce problems is spending time writing a Will to provide written instructions about settling the estate and to appoint an estate administrator.
When family disputes over property erupt, there is always a strong possibility that heirs will initiate legal proceedings to contest the Will. Anytime a Will is contested, estate assets are suspended in probate while lawyers sort out differences. This kind of proceeding is time-consuming and expensive for everyone involved and it rarely ends in a pleasant manner.
Fortunately, most people don’t have to contend with defending a contested Will, but if the problem arises it is very disruptive to family dynamics. Not only does contesting a Will result in broken relationships it can strip away inheritance property from all beneficiaries.
These issues can be minimized by taking proactive measures to safeguard estate assets. One option is to include a no-contest clause in the last Will. In a nutshell, this clause demands that heirs who file a lawsuit contesting the Will automatically forfeit their right to any property.
Another option is to insert a disinheritance clause. This is only used to write a person out of a Will. Most families don’t want to disinherit family members, but there are instances when it’s necessary to do so. It’s very important to talk to a probate attorney regarding the proper way to disinherit relatives because laws vary by state.
One way to avoid probate is to establish beneficiaries for valuable property and cash. There are many ways for gifting property to beneficiaries upon death. Property that is assigned to beneficiaries is not considered part of the estate and doesn’t have to endure the probate process.
Assignment of beneficiaries also allows for faster distribution of inheritance gifts and in some cases can minimize inheritance taxes. Since this kind of property is exempt, it leaves fewer probated assets and in turn, can reduce the potential of having heirs contest the Will.
Assignment of beneficiaries can also be established for investment portfolios, retirement accounts, life insurance policies, and contents of safe deposit boxes. Setting up beneficiaries is an easy process that requires property owners to fill out bank forms or establish joint titles.
It’s recommended to employ an estate planning service or probate attorney to help estate strategies. Every persons needs are different and will require different methods. However, at the very least every person of legal age should write a Will and establish healthcare proxies and a power of attorney forms.
Medical power of attorney is needed to appoint an agent to make healthcare decisions should a person become incompetent. Individuals can provide written instruction regarding any medical procedures and treatments that they are opposed to.
Power of attorney forms are used to grant privileges to a person to act as an attorney-in-fact, or agent. POAs are needed to authorize agents to engage in financial, real estate, and business transactions. It is crucial to select a trustworthy person that can be counted on to make sound financial choices.
Healthcare proxies, power of attorney, and Wills are basic essentials of estate planning. These legal documents can help make the probate process more tolerable and ensure heirs and beneficiaries receive the inherited property you want to provide to them.