Idaho Estate Planning: I Received Everything - Should I Give Some to My Siblings?
By Lane V. Erickson, Idaho Estate Planning Attorney
Estate planning for each and every one of us is very personal. While there are often estate planning documents that every person should have, which include a last will and testament, a durable power of attorney, a living will, a healthcare power of attorney, and possibly a trust or series of trusts, there are an unlimited number of ways that a person can use these estate planning documents to make a distribution to their family and loved ones. The person who creates the estate plan is and should always be in control of their own estate.
However, every once in a while, I’ll have a client ask the question about what they should do if they receive the entire estate from their parent(s) and there are other siblings who received nothing. The purpose of this article is to talk about the options that are available when this happens.
At the Racine Law Office our premier team of Idaho estate planning attorneys have assisted clients for over 70 years in creating and customizing their own estate plans. We also assist children of parents who have passed away, when probate and distribution issues arise. We are confident that we can answer your questions and help you with all of your estate planning and probate needs. Our Idaho estate planning team who have each earned the highest ratings possible from AVVO, Justia and Martindale and Hubbell, includes partners Randy Budge, and Lane Erickson, and attorneys Nathan Palmer and Dave Bagley. With our team’s help you can be assured that there will always be someone available to answer your questions and to assist you.
So, what can a child do if they are the recipient of their parent’s entire estate but there are other siblings around who received nothing. Really, there are a number of different things that can happen. Below, we discuss the applicable law when it comes to disinheritance. We then talk about some of the options that exist for the child who received the estate. Finally, we summarize some tax issues to keep in mind.First, a Parent can Disinherit a Child
The starting place is always with the law. It’s important that everyone understand that a parent can in fact disinherit a child. Idaho law specifically states that a person who is creating a will has the legal ability to disinherit just about anybody that they want.
Additionally, Idaho law says that when a person creates a last will and testament, or other estate planning document, the purpose of the law is to carry out the intentions that are stated in that estate planning document. For this reason, a court will not be sympathetic to a child who is disinherited unless, there is some evidence that the parent did not have legal capacity, which means they didn’t know what they were doing, or that they were unduly influenced by another person when they created their estate planning documents that disinherited the child.
The law does not question the reason the disinheritance occurs. Rather, the law only questions whether the estate planning document is valid and enforceable. If it is, the law simply states that it should be carried out exactly as it is written.Second, Once a Person Owns Property, They can Gift It to Whoever They Want
However, this does not bind the hands of the child who actually receives the money, property, or other assets from their parent’s estate. Once that child owns the property, they are free to gift it to whoever they choose, whenever they choose, and in the amounts they choose.
It’s important to understand that the child who does receive the property from the estate should receive that property. If they choose to disclaim that gift, from the deceased parent, they then will be treated as if they died before the parent. This does not automatically mean that the disinherited children will now receive an inheritance. Rather, usually what occurs is the child who disclaims their interest is skipped over and the next named recipient(s) will receive the estate. In other words, disclaiming an interest usually does not change the disinheritance and is usually a bad idea.
Perhaps the simplest answer that can be given to the question in the title above is that the recipient child can receive the entire estate. They can then divide it up and give gifts to the other siblings if they choose to do so. This is not a gift from the estate. Rather, this becomes a gift from the child of their own property.Third, Beware of Taxes
If a child does decide to give a portion of the estate they received to their siblings, they should be aware of the applicable federal gift taxes that may apply. Without getting into too much detail, it’s important to understand that as of 2019, any person can make an unlimited number of gifts to any other specific individuals up to the sum of $15,000 per person per year without creating any tax issues. If there are any gifts that are given while a person is alive that are greater than $15,000 per person per year, then there is a requirement that the gift be reported to the IRS.
In summary, disinheriting someone is legal. However, the recipient of any gifts given through an inheritance become the property of the person who receives them. This person can then gift away portions of that inheritance to anyone they choose.
We hope you have found this article helpful. It’s not designed to be exhaustive on this issue but just simply to provide a summary of the applicable law in Idaho. If you have additional questions or concerns, we are confident that we can help you.Enlist an Idaho Estate Planning Attorney to Help You
Our team of Idaho lawyers can help you with any of your estate planning or probate needs. Whether you are seeking to create or review an estate plan for yourself or would like to help a loved one, we are available to discuss your options and answer your questions at an initial free 30-minute consultation. Call us toll free at 877.232.6101 or 208.232.6101 for a free consultation. You can also email us directly at firstname.lastname@example.org or stop by our office at 201 East Center Street, Pocatello, Idaho 83201. We will answer your questions and help you solve your Idaho Estate Planning problems.