Planning to Exclude a Family Member From Inheriting From You?
Much of the estate planning advice you see focuses on the proper ways to provide for your spouse, children and other loved ones and friends in your estate plan. Many times this involves making a Will or setting up a trust to provide for their needs after your death. But what about those circumstances where you wish to specifically exclude a family member from inheriting from you? All too often, and for a number of different reasons, it may be appropriate to leave out a spouse or a child in your estate plan. Even when you decide to leave out a spouse or child, it is important to avoid some common pitfalls in order to give the proper effect to your estate plan.
Spouses and Ex-Spouse
In dealing with an ex-spouse, the law in Pennsylvania is very clear that upon a divorce, an ex-spouse is treated as predeceasing the other spouse (or dying first). In this situation, even if after a divorce, a person forgets or fails to change their Will to eliminate their ex-spouse, their ex-spouse would be treated as dying first and would not inherit from their ex.
There are certain situations however, where a spouse may want to specifically exclude their husband or wife from their estate plan. This can arise for many reasons. In some situations, where large estates have been accrued over the life of a couple, they may separately provide for one another by making certain gifts or transfers of property and accounts during their life so that, upon their death, the other spouse does not need to inherit from them. While this situation may sound unusual, it does occur. Also, it is important to understand that without the spouses consent, you can never really truly disinherit a spouse. The reason is that the Pennsylvania Law provides for the spouse to be eligible for an "elective share", wherein a spouse who has been disinherited can elect to take one-third of certain property from the other spouses estate. This situation frequently occurs where spouses become estranged but do not divorce prior to the death of one spouse. The spouses may have changed their Will to try to exclude one another but because they still enjoy the status as husband and wife upon one of their deaths, and because grounds for divorce have not yet been established, the surviving spouse may choose to "elect" against the other’s estate and receive one-third of certain types of property.
Disinheriting children may arise for a number of different reasons. Commonly, one child may be a poor money manager or, more frequently, some parents will give children substantial gifts during the parent’s lifetime and to "be fair to siblings" will then provide the remainder of their estate to the other children who may not have received similar gifts or transfers of money and property during their life. In this situation, and to disinherit a child, it is important that you are very specific and specifically mention your intention to do so in your Will. It is not enough to simply leave out a child. It is important to specifically state your intention that a child be excluded from receiving an inheritance. Sometimes a child is disinherited for other reasons which may or may not be known to them or family members. Your lawyer will include specific language in your Will to ensure your wishes are carried out. Additionally, with regard to inheritance for children, be aware there are pitfalls that arise in situations where Wills are made before children are born.
How can you ensure that your wishes are carried out as you intended for after your death? The best advice is to update your Will every couple of years and upon the occurrence of any major life events, such as a birth of a child, divorce, or other similar events. While it is difficult to plan for everything, updating your Will at appropriate times can help to avoid some of the pitfalls or errors that could occur as life changes.
Aaron Zeamer is an attorney at Russell, Krafft & Gruber, LLP in Lancaster, Pennsylvania. He received his law degree from Widener School of Law and practices in a variety of areas including Family Law and Estate Planning.