Disinheriting an Heir

It’s never an easy decision for a parent to disinherit a child. However, in some cases, a child’s behavior is so reprehensible, or the relationship has been so damaged, that a parent feels it is necessary. The first thing to remember is that your children do not have a legal right to your estate.  You earned the money and built your wealth.  It belongs to you, and you can leave it to anyone you desire.

If you want to disinherit someone, however, it is important to make that clear in your plan documents.  This is done by acknowledging the existence of that child, and then affirmatively stating that you have intentionally decided not to provide an inheritance for this child. Contrary to what many believe, you do not have to leave them $1.00 to disinherit them.

If you fail to plan, your child may inherit by intestate succession under state law.  If you create an estate plan but simply fail to name your child as a beneficiary, the child could go into court and claim you just forgot about them.  They could then inherit under a statute that protects forgotten children.  Therefore, if you are going to disinherit a child, you should make sure you do so clearly and affirmatively.

Anyone can file an action to contest a will or trust, and disinheriting someone may make that contest more likely.  However, that doesn’t mean they will prevail.  If an action is filed, that child will have to prove that you either lacked capacity to make the decisions you made in that plan document, or will have to prove that you were under some sort of undue influence or duress when you created your plan.

If you anticipate that someone will claim you lacked capacity to sign your estate planning documents, you may want to have your physician provide you with written documentation that you still have the ability to make your own financial decisions.  You can have your estate planning attorney document his or her file with this doctor’s declaration of your capacity.  You can also have the signing of your estate planning documents videotaped to show that you were interacting with the attorney about your wishes and confirming your decisions.

Another defense against a claim of incapacity is to specifically state the reasons for the disinheritance such as addiction, trouble with the law, the fact that you gave her money during life, the fact he never visited you or acknowledged your existence during life, or any other rational reason.  However, if the reason you state is later found to be incorrect or irrational, your child might be able to successfully avoid disinheritance.

You can also create a financial disincentive for the disinherited relative to challenge the plan. Trusts are more useful for this purpose than wills. For example, a beneficiary that would expect to inherit $100,000 may be left $5,000 as a bequest, with the provision that if the plan is challenged by the individual, he gets nothing at all.  Whether or not this works is dependent on state law.  Again, a qualified estate planning attorney needs to deal with issues related to disinheriting family members or beneficiaries in general.

If the reason you’re considering this drastic step involves addiction or other poor lifestyle choices, you may have alternatives to outright disinheritance.  A properly designed “special needs” trust, for example, can control distributions through a trustee.  You could: provide health insurance for the child; allow distributions for food, shelter, or clothing; provide distributions based on drug testing; provide for the costs of rehabilitation or counseling; or disinherit at a later date, if the child doesn’t change his behavior.

 

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