Estate Planning Blog

What Happens When Inheritance Goes to an Unexpected Recipient?

No one is prepared for the shock of an expected inheritance going to another person or an institution instead of a family member. It feels hurtful and unfair. Can it be challenged, asks MSN in an article, “My father just died and I was expecting a large inheritance. Instead, he’s given it all to the care home he was in. Is there anything I can do?”

The answer is, it depends.

Inheritances aren’t just about money. They’re about memories, family history, and a final message sent from the deceased. When a parent leaves everything to a nursing home instead of their children, it feels like a rejection.

Before firing off a series of furious emails or making phone calls, get a copy of the will. Any will filed in a local court can be obtained by anyone—regardless of their relationship with the deceased. Find out when the will was signed and start gathering facts. Details matter.

In general, anyone is free to leave their estate to anyone they want, including family, friends, charities, or a nursing home. There’s no rule saying children must inherit. But this doesn’t mean a will can’t be challenged, especially if valid questions are raised about the distribution.

Did the person understand what they were doing, act freely, and follow the right legal steps? If not, there may be room to challenge the will. If a person is seriously ill, heavily medicated, or living with dementia when the will was changed, this matters. A valid will generally requires the person to have legal testamentary capacity. They have to understand they are making a will, what they own, and who will benefit from receiving it.

Were they under undue influence? Elderly people in nursing homes are often targeted by scammers, being pressured to make changes to their wills. Isolation from loved ones, manipulation, or outright threats of physical abuse are unfortunately not unusual.

A generous gift to a nursing home providing end-of-life care isn’t suspicious in itself, but when a dramatic change to a will is made towards the end of someone’s life, it bears examining. Residents may be lonely and vulnerable, and boundaries may be blurred. If only one person or one institution becomes the sole heir, it is smart to ask questions.

Wills have strict legal requirements. They have to be signed by the person making it and witnessed correctly. If paperwork is sloppy, rushed, or involves people who had no business being involved, it should be challenged.

If there is an older will that leaves assets to family members, find it and compare it carefully with the new will. A dramatic change towards the end of life is relevant, especially if there’s no clear explanation. Timing could provide further insight. Was the will signed just after the person entered the nursing home? After a decline in health? Or after a staff member suddenly became very close to the elderly person?

A will prepared with an experienced estate planning attorney will be harder to challenge than one prepared with someone in the nursing home, which is likely to be invalid. If someone in the nursing home arranged for witnesses or hovered around the process, this raises valid suspicions. Medical records should be reviewed to show memory issues, medication changes, or vulnerability around the time the will was created.

Contact an estate planning attorney. They will be familiar with the fact patterns that lead to this type of situation and advise on appropriate courses of action. There may also be violations of facility policies, as well as state and federal regulations. The guidance of an estate planning attorney will help clarify the issues and determine whether or not the person expecting the inheritance has a case.

Visit our website www.MoTrustLaw.com to get more estate planning information and to subscribe to our complimentary e-newsletter.  Our e-newsletter is designed to provide valuable information to residents of Moberly, Macon, Kirksville, Salisbury, Columbia and surrounding areas.

Reference: MSN (April 23, 2026) “My father just died and I was expecting a large inheritance. Instead, he’s given it all to the care home he was in. Is there anything I can do?”

Trusts Prevent Delays for Loved Ones

Good estate planning ensures that your loved ones receive what you leave them without unnecessary delay or expense. However, that can go out the window when the procedure freezes your estate for months or years. Setting up trusts to avoid probate can go a long way to help your loved ones once you pass.

The Stress of Probate Delays

Waiting months for probate can worsen the grief of losing a loved one. Look no further than the story of Penelope Ormerod, as told by The Guardian.

When Penelope Ormerod applied for probate on her late aunt’s estate, she expected a smooth process. Instead, she waited for seven months due to severe delays in the probate system. Recent reforms and centralization efforts had made the system more unresponsive and left her waiting. Beneficiaries, like her daughter Jessica, had dreams of funding their education on hold. This is one example of the turmoil that can ensue when your estate doesn’t avoid probate.

What are Trusts and How can They Help?

Trusts are powerful tools in estate planning that can prevent your family from going through similar probate ordeals. Setting up a trust means transferring your assets smoothly and quickly to your loved ones. While the traditional will process often requires probate, a trust operates outside this framework. In many cases, this saves time and reduces stress for your inheritors.

How Do Trusts Prevent Delays for Loved Ones?

Trusts offer flexible, tailored methods for asset distribution. You can use a trust to give assets under various conditions or for specific purposes. You can establish trusts to provide your beneficiaries with lump sums or structured payouts. This ensures that beneficiaries like the Ormerod’s can avoid probate instead of waiting to receive their inheritance. Preventing delays in accessing an estate’s assets is particularly important for young families supporting minor children or ensuring that a family does not have to change their living arrangements due to court scrutiny of home ownership.

Can Trusts Avoid Probate, Saving Time and Money?

By avoiding probate, trusts can save your family stress, time and money. Probate fees and legal costs add up; setting up a trust can be a cost-effective way to pass on your assets.  Trusts can also reduce tax liabilities and get more of your money to your loved ones.

What Should You Do Next?

Consider setting up a trust so your family can receive their inheritance when you want them to. If you want to get started, contact an estate planning attorney. They’ll guide you through the options and help you ensure that your loved ones get what you leave them.

Avoid Probate and Set Up Trusts Today

Contact our law firm today if you’re considering setting up a trust or need more information on how trusts can help streamline the inheritance process. Our team is here to help you create a plan that manages your assets according to your wishes.

Don’t let probate bog down your family’s future—let’s talk about how a trust can work for you.

Key Takeaways

Avoid Probate Delays: Trusts can bypass the lengthy and stressful probate process. As a result, your beneficiaries will receive assets sooner and without undue stress.

Flexible Distribution Options: Trusts provide various ways to distribute assets. Choose from lump sums, structured payouts and other options that best serve your loved ones.

Cost and Time Efficiency: Trustees can save on legal fees and court costs by avoiding probate through a trust. Trusts may also reduce tax liability for your beneficiaries.

Secure Your Legacy: Setting up a trust with the help of an estate planning attorney helps safeguard your wishes when you’re gone.

References: The Guardian (May 2, 2021) “Grieving relatives despair at months of waiting for probate”

SmartAsset (August 25, 2023) “How Does a Beneficiary Get Money From a Trust?”

Challenging a Will: What to Do If You Believe Your Inheritance Is Incorrect

Dealing with the death of a loved one is never easy, and it can be even more challenging when you have questions about your inheritance. You might feel like a will doesn’t match the intent of your deceased loved one, whether they forgot to update it or made another mistake. Beneficiaries have the right to challenge a will that they feel is wrong.

What Should You Do If You’re Unsure about Your Inheritance?

When a loved one passes away, it’s natural to have questions about what you’ll inherit. The first step is to understand the will’s contents and the executor’s role. The executor manages the deceased’s estate and distributes the assets according to the will.

When to Challenge a Will

Consider the story NJ.com shared, where a woman was unsure if she received the right inheritance after her mother died. The woman struggled to communicate with her brother, the executor. The last she’d heard from her mother, she had assets such as insurance policies, a safe deposit box, and a paid-off home.

However, the brother claimed the mother had liquidated her assets and reverse-mortgaged her home and that nothing was left. Naturally, the woman was afraid that she was being defrauded of her inheritance.

What Does it Mean to Contest a Will?

Contesting a will involves legally challenging its validity. Beneficiaries often do this because they believe the will does not accurately reflect the deceased’s wishes.

You may be able to contest a will if you have standing and valid legal grounds. Broadly speaking, you can challenge a will if you believe it’s been revoked or is legally invalid. As MetLife describes, the most common grounds to contest a will include:

• Forgery: Believing the will was signed by someone other than the decedent or the decedent wasn’t mentally competent.
• Lack of due execution: The will wasn’t executed following legal protocols.
• Mistakes or incompleteness: The will contains errors or is unfinished.
• Mental incapacity: The decedent was not of sound mind when creating the will.
• Undue influence: The decedent was coerced or manipulated into signing the will.
• Revocation: The decedent had revoked the will by creating a new one or destroying the old one.

Who Can Contest a Will?

To contest a will, you must have legal standing. Generally, this means you have a financial interest in the estate. Some cases in which you would have standing include being named in a previous version of the will or if state law would leave you to inherit the estate without a will.

How Can You Protect Your Inheritance Rights?

If you believe you are not receiving the inheritance you are entitled to, there are steps you can take to protect your rights:

• Communicate with the Executor: Try to resolve any issues by discussing them with the executor.
• Request a Copy of the Will: You have the right to see the will and understand its contents.
• Seek Legal Advice: If you cannot resolve the issue, consider seeking legal advice to explore your options.

What Should You Do to Contest a Will?

If you decide to contest a will, it’s important to act quickly. After all, most states offer a limited timeframe for you to file your challenge. Reach out to our estate planning attorneys today to schedule a consultation and get started.

Key Takeaways

• Understand Your Rights: Know what you are entitled to inherit and communicate clearly with the executor.
• Legal Grounds: Contesting a will requires valid legal reasons such as forgery, lack of mental capacity, or undue influence.
• Seek Legal Advice: Consult an attorney if you have concerns about your inheritance or wish to contest a will.
• Estate Planning: Creating a clear and legally binding will can help prevent disputes and ensure your wishes are followed.

References: MetLife (Jan. 30, 2023) “Contesting a Will: What to Consider”

NJ.com (Feb. 18, 2019) “My mom died. How can I know I’m getting the right inheritance?”

What Does an Executor Need to Do?

Being named an estate executor is an honor and a big task. It is an honor because being named executor means your family member or friend trusts you implicitly enough to put you in charge of their estate when they are gone. It’s also a big task, with many moving parts to manage, which is the topic of a recent article from Kiplinger, “Eight Steps to Take When Settling an Estate as the Executor.”

You may feel like you must accomplish all of the tasks as soon as possible. However, working through an estate takes time. As a fiduciary, the executor must prioritize the decedent’s desires and the estate’s interests.

Managing expectations for the executor and heirs. It can take anywhere from two months to five years to settle an estate, depending upon its complexity and how much planning has been done. There is always the brother-in-law who knows better than anyone else how things should be handled and how long it should take. Ignore this.

Death certificates. An early task in the process is working with the funeral home to arrange memorial services, burial, cremation, or whatever the decedent wanted. Request ten original death certificates, since the probate court and financial institutions will want original certificates, which may or may not be returned.

Where are the estate documents? To file for probate, you (or an estate planning attorney) will need the last will and testament, trust documents, titles for cars or boats, deeds for the home, etc. ou should also try to locate a letter of instructions or intentions. This is not legally binding but can provide more insight into the person’s wishes.

Make a list of financial institutions, life insurance, and other assets. After you’ve been an executor and seen how complicated it becomes when you don’t have this list, chances are good you’ll start creating one for your own executor. A list of all financial institutions where accounts are held, the name of a financial advisor, estate planning attorney, or CPA, and information about all insurance (life, health, car, auto, home, etc.) spares the executor from having to conduct a scavenger hunt to identify these assets. Start a spreadsheet or a handwritten notebook to track every step you take with these assets, from who you speak with, what is said, best contact emails and phone numbers, etc.

Contact Social Security and any pension custodians. You’ll need to notify SSA and pension companies to have payments stopped and any benefits paid to the estate.

Find digital assets. Here’s where it gets tricky. Traditional assets often turn up when statements are mailed. However, if all statements are being made through email, you’ll need to log into the person’s computer and start looking for accounts, including financial accounts, credit cards, subscriptions, loans, leases and recurring charges. You’ll also need to notify the three credit bureaus. Look for a computer file or a printout of all accounts with passwords, including social media.

Contact the HR department if the person was still working. If the person has passed, let the HR department know. You may need to do some paperwork concerning retirement plans, health benefits and compensation for unused vacation time. Let the financial aid office know if a minor child is away at college. The student might now qualify for assistance.

Don’t be averse to getting professional help. Talk to the person’s estate planning attorney, financial advisor and CPA. If your loved one died without making a will, you’ll need help managing the probate process and figuring out what, if any, debts need to be paid. The estate planning attorney will also help you navigate any estate taxes, both on a federal and state level.

Reference: Kiplinger (April 3, 2024) “Eight Steps to Take When Settling an Estate as the Executor”

Inheriting a House? Navigate Your Options and Responsibilities

Inheriting a house can be a life-changing event with emotional and financial implications. Understanding your options and obligations is critical, whether you sell it, keep it, or rent it out. Insights from LendingTree show you how to make the most of your inheritance.

What’s the Legal Process of Inheriting a House?

When inheriting a house, you don’t immediately receive the title in your name. The inheritance process involves probate, where a judge reviews the will and appoints an executor to carry out the deceased’s will. The executor handles responsibilities like insurance, identifying debts or liens and paying utilities. They also distribute belongings and manage property taxes. This ensures that the estate’s assets settle any outstanding debts before you receive ownership.

What Should You Do when Inheriting a Home?

When you’re in line to inherit a home, there are five steps you should take immediately.

1. Communicate with the Executor: Establish a clear line of communication with the executor. This will help you learn the necessary information and simplify the transfer process.
2. Coordinate with Co-Heirs: Work with the others if you are one of several heirs. Avoid costly disputes by deciding whether to sell, keep, or rent the property.
3. Get an Appraisal: An appraisal calculates the property’s value. This informs your decision to keep, sell, or rent the home while informing you of tax liabilities.
4. Evaluate Debts: Identify any liens or debts tied to the property and compare them against the house’s value. Understand the financial implications and incorporate that into your decision.
5. Seek Professional Advice: Consult estate planning attorneys, accountants and financial advisors. These professionals can clarify ownership-related problems, such as debt obligations and inheritance taxes.

What Should You Do with the House?

Moving Into an Inherited House

Moving into the inherited house can provide a new residence or vacation home. However, this option can be costly due to mortgages, taxes, repairs and insurance.

Renting Out an Inherited Home

Renting out the property can provide passive income, while keeping it in the family. Buy out other heirs or work with them to share costs and rental income.

Selling Your Newly Inherited Home

Selling the house is a straightforward way to obtain immediate cash. The proceeds can help pay off debts tied to the house, and the remaining proceeds will go to the heirs.

How Can You Finance an Inherited House?

If debts and taxes are associated with the house, that doesn’t mean you need to sell. There are many ways to finance the home and keep your inheritance.

• Mortgage Assumption: Take over the existing mortgage if its terms are better than what you’d get with a new loan. The lender must approve the assumption.
• New Purchase or Refinance Mortgage: You can obtain a new mortgage or refinance to put the house in your name. This option is particularly useful when the property has a reverse mortgage.
• Cash-Out Refinance: Refinance the mortgage with a cash-out option to tap into the home’s equity to cover expenses, like buying out heirs or making repairs.
• Investment Property Loan: Mortgage an investment property if you plan to rent the house.

Inheriting a House? Schedule a Consultation Today

Navigating the process of inheriting a house requires legal, financial and practical knowledge. You can get this knowledge by scheduling a consultation with our estate planning attorneys. We’ll listen to you and provide tailored advice about handling your inheritance.

Key Takeaways

• Inheriting a House: The probate court oversees the inheritance process, and the executor handles legal and financial responsibilities.
• Options: Move in, rent out, or sell the property based on financial goals and agreements with co-heirs.
• Financing: Explore mortgage assumptions, new or refinanced mortgages and other financing options.

Reference: LendingTree (Nov. 16, 2021) “Inheriting a House? Here’s What to Expect”

What Happens When Executors Keep Beneficiaries in the Dark?

A couple who never had children created a will, leaving their six nieces and nephews equal shares of their estate upon their deaths. When the uncle died, the aunt remarried years later but never changed the will, except for giving her second husband a life tenancy in the family home. A recent article from Market Watch asks if what happened next is right: “My late aunt gave her husband a life tenancy in her home—but her attorney won’t even let us see the will. Is this a bad sign?”

The problems began when the aunt’s attorney told the nieces and nephews that they were responsible for the taxes and property insurance while the life tenant lived in the home. The nieces and nephews had never seen a copy of the will, so they are unsure of their responsibilities as remaindermen. Nothing in the estate needed to go through probate, so the aunt’s will was not available to beneficiaries through the county court.

This case illustrates several important estate planning points. First, an executor of a will (or an administrator of an estate) is required to keep beneficiaries “reasonably informed” of the will’s contents after probate. It seems reasonable for the nieces and nephews to be able to see the will.

In most cases, the person given the life tenancy is responsible for paying taxes and property insurance and for the general upkeep of the residence. Any other arrangement is unusual, so the nieces and nephews are right to want to see the will.

The life tenant has rights, including the ability to rent out the property. However, they can’t do anything to decrease the house’s value. It’s important to know that elderly people may be unable to apply for Medicaid because they live in the house this way.

If it has been months since the person died and there hasn’t been any communication from the executor, a few different scenarios are possible. It may be that the executor doesn’t know they are required to keep beneficiaries informed. However, it’s also possible that the executor is engaging in illegal behavior.

In most states, the executor is responsible for providing beneficiaries with a complete inventory and appraisal of all the estate’s assets. Depending on the state, probating an estate may take more than six months, and creditors have a certain number of months to file a claim.

Suppose the beneficiaries wish to replace the executor. In that case, they can do so by speaking with an estate planning attorney and being prepared to go to court and prove the executor is either self-dealing, incompetent or has a conflict of interest.

However, once the will is probated, it will become part of the public record and must be filed in probate court. Depending on the jurisdiction, the court will give the beneficiaries the right to access the will.

The best option for the nieces and nephews is to consult an estate planning attorney to explore their options. If they live in a different state, a local estate planning attorney can recommend someone in their aunt’s jurisdiction to help.

Reference: Market Watch (April 28, 2024) “My late aunt gave her husband a life tenancy in her home—but her attorney won’t even let us see the will. Is this a bad sign?”

An Estate Plan Question: How Do My Heirs Receive Their Money?

You are proactive and designed an estate plan with your beneficiaries in mind. You evaluated the options and chose a trust to distribute your wealth as you intended. Have you considered how your heirs will receive the money?

Trusts are powerful estate-planning tools that bypass probate and provide a structured method for transferring assets to beneficiaries while minimizing tax implications. But how do beneficiaries receive money from a trust? The Smart Asset article “How Does a Beneficiary Get Money From a Trust?” addresses this question. Let’s explore trusts, distribution methods, and how a trust can make it easier or harder for heirs to get the money.

Why Trusts are a Reliable Go-To Estate Planning Strategy

Trusts are a tried-and-true strategy for providing for loved ones after you’re gone and leaving a multigenerational legacy. A well-structured trust can preserve wealth, avoid probate, and control asset distribution while minimizing taxes.

A grantor establishes a trust through a legal document and funds it with assets, including investments, retirement or bank accounts, real estate, and other property. The trust document appoints a trustee or co-trustees and outlines trust administration. Terms and conditions instruct how and when the trustee distributes the estate to named beneficiaries.

How Do Beneficiaries Receive Money from a Trust? What are the Methods of Distribution?

• Outright Distribution: The trustee distributes trust assets directly to beneficiaries, typically without restrictions. Money is deposited into a bank account or as a check. Real estate is given as a new deed or sold for the money.
• Over-Time Distribution: The grantor may opt for a phased approach, where assets are distributed to beneficiaries gradually based on predetermined criteria. This might involve reaching a certain age or meeting specific life milestones.
• Trustee’s Discretion: The trustees are granted discretion over asset distribution, which is particularly beneficial for beneficiaries who struggle with financial management. Trustees ensure assets are distributed responsibly based on the grantor’s intentions.

How can Trust Distribution Methods Make It Easier or Harder for Beneficiaries to Receive the Money?

Grantors can structure a trust, making it easier for heirs to receive the money through direct and unrestricted distribution. Adult and financially sound beneficiaries are good candidates for this method. Minor or irresponsible heirs would likely benefit from restrictions and distributions over time.

Knowing your beneficiaries, you can establish a trust to preserve and protect assets in their best interests. One caveat is that trustees must distribute assets within a reasonable timeframe, typically after fulfilling administrative tasks such as reviewing trust terms and obtaining asset appraisals. While there’s no strict deadline, prolonged delays can incur additional costs for maintaining the trust.

Trust Beneficiary Distribution Key Takeaways:

• Structuring a Trust: A grantor establishes a trust through a legal document, funds it, and appoints a trustee or co-trustees to administer the trust and distribute the estate to named beneficiaries.
• Distributing Assets: A distribution can occur outright, gradually, or at the trustee’s discretion.
• Considering Your Beneficiaries: A responsible or irresponsible heir can help determine the terms and conditions of distribution.

Conclusion

Whether assets are distributed outright, gradually, or at the trustee’s discretion, being well-informed empowers you to make sound financial decisions. Seeking advice from an experienced estate planning attorney can provide valuable insights and guidance tailored to your needs.

Reference: Smartasset (Aug. 25, 2023) “How Does a Beneficiary Get Money From a Trust?”