What are the different forms of property ownership, and how do they affect rights to leave property in a will?
Anyone, married or unmarried, may be a co-owner of certain possessions, and this co-ownership can limit your right to give something away in your will. Read the fine print on your deeds and titles. When two or more co-owners are named on the document, and it states that the property is held in joint tenancy, then the asset–whether it’s money in a bank account, a car, or a house–will go directly to the surviving owner or owners upon your death–even if the deceased tries to give his interest to someone else in his will. That’s because a joint tenancy automatically carries what is known as a right of survivorship. If the property is held this way by spouses, it will usually pass to the survivor free of gift or estate tax.
Tenancy in common, on the other hand, allows you to sell your share or leave it in a will without the consent of the others. If you die without a will, your share goes not to the other owners, but to your heirs.
It’s important to remember that either form of ownership can sometimes be overridden by community property laws and other forms of spousal rights. In other words, when Gordon’s brother Jim dies, Jim’s widow might be able to claim an interest in the beach house, though she’s not named in the will or on any deed.
What’s the best way for a parent to divide possessions among children?
There are several ways to divide up your tangible personal property, which is anything other than real estate or money, and includes such things as furniture, cars, jewelry, china, and so on. You can:
- Itemize your bequests in your will, naming who gets each item.
- Leave your personal possessions outright and in equal shares to your children.
- File a memorandum with your will with instructions on how your possessions should be divided. Many states will recognize it as legally binding; in the states that don’t, the memo will still (you hope) carry moral weight with your children. Such a memo can also contain information useful for finding or using your assets, such as the location of car keys, or other small items. The advantage of such a memo, is that you can change it without all the formality necessary when modifying your will.
- If you think your children may not see eye to eye on the value of your things, or on what makes an equal share, you can give your executor authority to decide which child gets which item. (With this method, don’t name one of your children your executor!)
- Direct your children in your will to choose items in sequence. If you think they might argue over who gets first choice, direct them to draw lots to decide who chooses first, second, and so on.
What happens if a person forgets to designate certain assets?
Typically, a will contains a clause saying something like, “I give my car to Henry, my boat to Ellen, and the balance of my tangible personal property to George.” In that case, George gets any items which haven’t been given away under more specific provisions. If the will doesn’t have such a general clause, the items go to the person named as residuary legatee.
What happens to bequests to people who die before the person who writes the will?
It depends on what the will says. As noted, it’s always a good idea when writing a will to name alternative beneficiaries. This and other key phrases can guide an executor to, in effect, fulfill a deceased’s plan B if plan A doesn’t work. Basically, though, they direct that a bequest to a predeceasing beneficiary pass to his or her heirs.
What happens if property left in a will no longer exists?
That’s probably tough luck for the person named as the beneficiary. In most cases, he or she would get nothing.
What happens if there is less (or more) money to be divided among heirs than at the time a will was written?
It is almost certain that the value of financial accounts will change over time, and thus can’t be specified in a will. You can deal with this two ways. First, you could have a specific amount set aside for one person, and have the balance go into the residuary estate to be divided according to other directions you leave. Or, you can specify how much each person will get. In that case, the funds will be distributed proportionately.
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