New York Estate Planning & Elder Law Blog
Children and Estate Plans: Equality Is Not Required
If you do not have an estate, at least one person you know has probably recommended that you create one as soon as possible. Among the various questions that the creation of an estate plan presents is how exactly to divide assets. While you likely want to help your loved ones have an easier time in case something happens to you, it can be challenging to determine how to achieve these goals.
While you might have considered passing assets to the children that need it most, you might have quickly dismissed this thought because passing on your assets in an unequal amount might seem unfair. In reality, passing on your assets to your children in equal amounts is not necessary. This article reviews some of the most common situations where unequal distributions might be the best choice to make.
Situation # 1 – A Child Faces Addiction Issues
If one of your children struggles with an alcohol or drug addiction, it is likely not a good idea to leave a large inheritance to them. At the very worst, this type of decision could have deadly results if the child decides to use these funds to further fuel their addiction. While you might decide to still distribute an equal amount to each child, you might decide to pass on assets to a child who struggles with addiction using a different type of estate planning tool. By placing these assets in a trust, you can make sure that these assets are distributed in periodic amounts that requires the fulfillment of certain conditions like attending Alcoholics Anonymous or successfully passing blood screening tests.
Situation # 2 – A Child Acts as a Caregiver
People choose to tackle the challenges of old age in various. One solution is to task a child with performing caregiver duties, which includes things like making meals, paying bills, and shuttling you to appointments. Given these sacrifices, it is often understandable that you want this child to receive a larger amount of inheritance than other children in exchange for performing these additional tasks.
Situation # 3 – A Child Has Special Needs
The United States Department of Agriculture reports that it takes approximately
$240,000 to raise a child from birth to the age of 18. If a child has special needs, these costs can often quadruple. If your child has special needs, you should give great thought to create a special needs trust to pay for the child’s expenses.
Among other reasons, passing assets on in this manner is a way of making sure that an inheritance does not inadvertently disqualify a child from receiving government benefits. In addition to using a different estate planning tool to pass on assets to the child with special needs, it is also likely that you will choose to pass on a large inheritance to the child than their siblings.
Speak with a Knowledgeable Estate Planning Lawyer
There are some valid reasons why you might decide to pass on your assets to your children in an unequal manner. To determine what type of estate planning structure works best for you, however, the assistance of a skilled estate planning lawyer is often critical. Contact Ettinger Estate Planning today to schedule a free case evaluation.