Understanding Disinheritance: What It Is and How It Works

What Is Disinheritance?

Disinheritance refers to the deliberate act by which a person chooses to exclude someone who would otherwise be a natural heir from receiving an inheritance through their will or estate plan. Typically, this involves a parent not leaving any assets or property to their child or children, but it can apply to any potential beneficiary, including spouses, siblings, or other relatives.

In legal terms, disinheritance must be clearly stated in the will or trust to avoid ambiguity and potential legal disputes. Simply excluding someone may not be enough; clear and explicit language is typically required to ensure the disinheritance is legally valid.

What Are The Reasons To Disinherit Someone?

Disinheriting someone from your will or estate plan is a significant decision that can stem from various reasons. Here are some common causes:

• Estrangement or Abandonment: A long-term breakdown or lack of relationship, especially in cases of neglect or lack of contact, can be a significant factor.
• Financial Concerns: If a potential heir has a history of substance abuse, irresponsible financial choices, or gambling problems, disinheritance may be seen as a way to help protect assets.
• Legal Issues or Creditor Protection: Disinheritance can also be a strategic decision to help protect assets from an heir's creditors, legal judgments, or in anticipation of a divorce where marital assets might be at risk.
• Prior Gifts: If someone has already received substantial gifts during your lifetime, this might be considered their "fair share" of the inheritance.
• Protecting Other Beneficiaries: Disinheritance may be used to prioritize the needs of other heirs, such as a disabled child or a spouse requiring long-term care.
• Second Marriages and Blended Families: You may choose to disinherit children from a previous marriage to ensure that the estate benefits the current spouse and any children from the current marriage.

Individuals considering disinheritance should consult with an estate planning attorney to understand the legal implications, ensure their wishes are clearly and legally documented, and consider the potential emotional impact on the family dynamic.

How to Disinherit Someone?

Disinheriting an heir requires careful planning and adherence to your state's specific laws. Here are the key steps:

1. Create or Update Your Will or Trust: The primary mechanism for disinheriting someone is through a valid will or revocable living trust. If you don't have these documents, it's essential to create them. If you do, they likely need to be revised.
2. Explicitly Name the Disinherited Person: Simply not mentioning someone in your will might not be enough to disinherit them. To avoid ambiguity, clearly state that you are intentionally excluding the person and that they will receive nothing from your estate.
3. Consider a "No-Contest" Clause: A no-contest clause discourages beneficiaries from challenging your will. If a disinherited heir contests the will and loses, this clause could result in them forfeiting any inheritance they might have otherwise received.
4. Work with an Estate Planning Attorney: The laws regarding disinheritance are complex and vary by state. An experienced estate planning attorney can guide you through the process, ensure your documents are legally sound, and help minimize the risk of your will being contested.

Important Considerations:

• Spousal Rights: In some states, your surviving spouse may have a legal right to a portion of your estate, even if you attempt to disinherit them. Consult an attorney to understand your state's laws.
• Children's Rights: Specific state laws might protect minor children or children omitted from a will unintentionally due to a simple oversight.
• Mental Capacity: Your will must be created while you are of sound mind. If your capacity is questioned, it could make your will vulnerable to being contested.

Additional Tips:

• Keep Records: Document the reasons for your decision to disinherit someone. This could be helpful if your will is ever challenged.
• Communicate Carefully: While not legally required, consider having a conversation with the person you are disinheriting (or their legal representative). It might help them understand your reasons and lessen the potential for conflict.

Alternatives to Disinheritance

Disinheriting someone can have severe legal and emotional consequences. Consider these alternatives before making a final decision:

Establish a Trust

Trusts offer more control over how and when your assets are distributed. You can create a trust with these features:

• Conditional Distributions: Tie distributions to specific goals like college graduation, sobriety, or reaching a certain age.
• Spendthrift Provisions: These provisions protect beneficiaries who have trouble managing money by limiting their ability to receive at once.
• Discretionary Distributions: Appoint a neutral trustee to distribute funds based on a beneficiary's needs or demonstrated responsibility.

Gifting While You're Alive

Give assets directly to your intended beneficiaries during your lifetime. This gives you some control and lets you witness how they manage those gifts. However, be aware of potential gift tax considerations.

Open Communication

Sometimes, honest conversations about your concerns can improve a strained relationship or help you understand a beneficiary's financial situation and life choices. Open dialogue might lead to a mutually agreeable solution.

Limited Power of Appointment

Allow a trusted family member or friend the power to redirect an inheritance after your death. This option maintains your primary plan but grants some flexibility should circumstances change.

Important Considerations:

• Complexity: Some alternatives, particularly trusts, can be complex. Consult with an estate attorney to ensure the solution aligns with your goals.
• Potential for Conflict: There might still be hurt feelings or family tension even with alternatives. Be prepared for emotional fallout.
• Changing Circumstances: Your wishes or beneficiary's situation might change over time. Periodically review your estate plan to ensure it aligns with your intent.

Factors to Consider Before Disinheriting Someone

Disinheriting a family member or loved one is a complex decision that requires careful consideration of various factors.

Legal Considerations

• State Laws: Disinheritance laws vary from state to state. Some states may have protections for spouses or children, limiting your ability to fully disinherit them.
• Contesting a Will: Disinherited individuals might contest your will, especially if they suspect undue influence or lack of mental capacity. Understanding the potential grounds for a challenge can help you create a more robust estate plan.
• Unintentional Consequences: If you don't carefully word your will or trust, you might unintentionally disinherit others, such as future grandchildren. Attention to detail helps to avoid this oversight in estate planning.

Emotional & Familial Impact

• Family Dynamics: Disinheritance can cause significant damage to family relationships, potentially creating lasting rifts and conflict.
• Emotional Toll: The decision to disinherit someone can be emotionally draining for all involved. Consider the potential long-term emotional consequences for yourself and your loved ones.
• Potential for Reconciliation: Is there any chance for reconciliation in the future? In some circumstances, leaving the door open for communication might be preferable.

Practical Considerations

• Reasons for Disinheritance: Critically evaluate your motivations. Are they grounded in genuine concern or based on temporary anger or disappointment?
• Financial Impacts: Consider how disinheritance might impact other beneficiaries. Could it place an unfair burden on them or inadvertently leave them vulnerable?
• Alternatives: Have you fully explored other options for addressing your concerns, such as trusts, open communication, or limited gifts?

Seeking Professional Advice

• Estate Planning Attorney: An attorney specializing in estate planning can help you navigate your state's laws, understand potential hurdles, and craft a legally sound will or trust.
• Financial Advisor: A financial advisor can assess the overall impact of disinheritance on your estate plan and long-term financial goals.
• Therapist or Counselor: If the reason for disinheritance involves complicated family dynamics, a therapist can assist with navigating the emotional complexities of the decision.

Remember, disinheritance should rarely be the first resort. Careful consideration of all factors and seeking professional guidance are crucial before making this significant decision.

Conclusion

Disinheritance decisions are never easy. Understanding the legal and emotional ramifications is essential for everyone involved. If you need further guidance, consult with a qualified estate planning attorney in your state.

Start by exploring our free will creation service from Fabric by Gerber Life. It's quick, easy, and the perfect way to begin securing your legacy. Start planning for tomorrow, today.³

Sources

1. Disinheritance - Cornell Law School - Legal Information Institute. https://www.law.cornell.edu/wex/disinheritance
2. Factors to Consider Before Disinheriting a Child - the balance. https://www.thebalancemoney.com/considerations-before-disinheriting-child-3505372
3. Free Will from Fabric by Gerber Life, a member of the Western & Southern Financial Group Family of Companies. https://www.westernsouthern.com/about/family-of-companies.