• 21
  • June
    2011

When individuals have been told that they will be the beneficiary of an estate and they do not receive anything, they can be left feeling betrayed or neglected when their loved one has passed on.

There are several reasons that beneficiaries might not receive the inheritance that they may have expected. The following are some examples of how and why this may occur.

  • Wills are commonly challenged in probate court. As a result, regardless of what a beneficiary has been told they will receive, what they actually receive may be left for a court to decide.
  • Assets are dispersed in a certain order. Under Florida law there is an exact order in which a decedent's debts are paid. Bequeaths take second place to unpaid debts, liens and federal taxes.
  • The IRS will come collecting. If a beneficiary receives money from an insurance, retirement or pension account, the IRS can come after the beneficiary for any federal taxes due from the decedent.
  • Deathbed marriages may not be recognized. Marriages that could appear not to be completely voluntary can be voided by the court. If that happens, a newly wed spouse may not be entitled to any part of the estate.
  • Funds are lacking. Investment scandals and the recession have taken their toll on many Florida residents' investment portfolios. This has left many Florida estates with fewer assets to be divided and passed on to beneficiaries.
  • Executors make mistakes. Executors who do not understand the deceased's exact wishes will not necessarily disperse the assets in the estate as desired or as promised.
  • Oral promises are not carried out. Written documents will always carry more weight than verbal promises. If the written will does not include a perceived promise, that promise will likely not be kept.
  • Wills and trusts are not always clear or current. If a will or trust is not clear or does not represent the current state of the decedent's affairs or intentions, then it will be difficult for beneficiaries to receive their expected inheritance.

With proper estate planning, it may be possible to avoid the situation in which beneficiaries are left without their expected inheritance. This is why it is extremely important to have wills and trusts properly drafted.

In our next post we will discuss two specific examples of real life mistakes made by wealthy individuals.

Source: Palm Beach Daily News, "Wishes of the deceased over the division of assets must run legal gauntlet before reaching beneficiaries," Dian Vujovich, 18 June 2011