How does a beneficiary’s premature death impact an estate?

On Behalf of | Sep 27, 2022 | Estate Planning |

From a practical standpoint, estate planning functions on contingencies. All plausible alternatives require consideration based on priorities and current circumstances. The most prudent person, however, cannot fathom every scenario. A beneficiary who predeceases the author of the will exemplifies a common, albeit uncomfortable, situation that can effect an entire estate.

What are anti-lapse statutes?

Any gift distributed via a will to a designated beneficiary who has died prior to the author of the will, or testator, ceases to exist, or lapses. State laws (“anti-lapse” statutes) permit blood relatives within varying degrees of the deceased beneficiary to receive the share. Without a change to a will after the beneficiary’s death or language instructing how to distribute the gift, a residuary estate exists subject to different state laws that distribute the gift according to a predetermined hierarchy of relationships.

When can a beneficiary legally receive a gift?

Specific provisions apply to the circumstances described above in Arizona. In the absence of other beneficiaries besides those who have passed away, a spouse receives all of the assets. This applies regardless of whether the couple had children. One state law addresses a plausible but often unaccounted for situation. A beneficiary must survive for at least 120 hours after the testator’s death by a legal standard of clear and convincing evidence. Failure to evidence that fact significantly changes those eligible for gifts under the will.

All parties with legal interests in a will adapt their expectations. Beneficiaries, testators or those appointed or named to administer the estate will handle the changing circumstances better than those who do not. Attorneys familiar with the legal and emotional process can help.