WILL CONTROL: HANDLING YOUR WILL AFTER PASSING

As favorable gift-tax rules slated to end in December, will stipulations are becoming more relevant during the estate planning process. Whether it is forcing heirs to undergo drug testing or even requiring children to visit a family member’s grave, estate planners are becoming more creative in drafting the hurdles that heirs must clear before they are able to receive money or assets. However, even with the flexibility, Texas residents have to control their heirs after they are gone, some will stipulations could end up in a court battle.

Many people do not know that there limits apply to what people can and cannot require. One provision that could prevent people from certain requests is called ‘contrary to public policy.’ This provision prevents the promotion or encouragement of divorce or criminal behavior. Recent changes also include prohibiting racist behavior. As an example, a will that stipulated leaving money only for a scholarship for white students would likely be struck down in court.

Furthermore, discouraging someone from getting married could also wind up in a court battle. However, the law is flexible in this requirement because it allows someone to bypass their heir’s spouse or any future spouses. Vagueness could also be struck down. Anything that could be viewed as illegal, impossible or even ambiguous is likely to be thrown out in a court.

In the end, the law is typically favorable to people leaving assets as they wish, as long they don’t encourage any of the above mentioned cases. Texas residents planning their will who wish to use a unique stipulation may want to ensure they are familiar with all applicable state laws before adding such a requirement. Doing so could prevent heirs from having to deal with courts.

Source: The Wall Street Journal, “How to Control Your Heirs From the Grave,” Laura Sanders, Aug. 10, 2012