Personal Gifts in a Will
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What's a Personal Gift in a Will?
A personal gift in a will is property that is distributed from one person to another through the use of a valid will document. Since the gift is to be distributed using the will, this means that the gift will transfer to the recipient only upon the death of the owner. These gifts are considered “personal” because they are transferred from one person to another specific person, rather than a general entity such as a charity.
There are many reasons why a person would choose to distribute gifts through a will upon death rather than during their lifetime while they are still alive. A common situation is where the owner of the property will still be using the asset during their lifetime (such as a residential home or their everyday car). They may only want to transfer the property after death so that they can continue using the property.
Are There Different Ways to Distribute Personal Gifts in a Will?
Yes- there are a few different ways to distribute a gift in a will. This mostly depends on the wording used to describe the property, as well as the way in which the owner classifies the gift. In general, there are three different ways to categorize personal gifts in a will:
- Specific Gifts: A gift that is described in detail and clearly identified as a specific piece of property is called a specific gift or a specific devise. For example, if the property owner decides to give “my 1980 Chevrolet Camaro” to “my son Bob”, this would probably be considered a specific gift. The gift instructions would only be satisfied if Bob receives the 1980 Camaro, and not a different car.
- General Gifts: A general gift is one that isn’t described clearly enough to associate with a specific item. For example, if the person writes in their will that they wish to give “one of my cars” to “my son Bob”, this might be considered a general gift. The distribution of any of the person’s cars to Bob would then satisfy the gift instructions.
- Residual Gifts: This deals with the distribution of property that is left over once the specific and general gifts have all been distributed. For example, the property owner might state in their will, “I give the rest of my property to my Aunt Michelle.” Michelle will then receive whatever property is leftover, sometimes reduced to a lump monetary sum
The difference between specific, general, and residual gifts comes into play when one of the gift requirements is not satisfied. For example, if the property owner chose to give a certain ring as a specific gift, but they did not possess the ring anymore at the time of death, it could affect the entire chain of property distribution. Thus, it is important that personal gifts in a will be drafted clearly and carefully to ensure that the person’s wishes will be carried out.
Is It Better to Transfer a Gift in a Will or during My Lifetime?
A gift that is distributed through a will after death is known as a “testamentary gift.” In contrast, a gift that is distributed while a person is still alive is called an “inter vivos gift.” Inter vivos gifts are usually distributed through other means besides a will, such as a living trust.
The choice of whether to distribute gifts during life or after death is largely a matter of individual preference and discretion. As mentioned, if the holder of the property will still be using the item until their death, it may be better to transfer the gift through a will. But, if they would like to have the item distributed while they are still alive, it may be better to transfer it as an inter vivos gift rather than a testamentary gift.
Some of the characteristics of testamentary gifts and inter vivos gifts are:
- Testamentary Gifts:
- Sometimes revocable: Testamentary gifts can sometimes be revoked at the request of the donor
- Donor retains possession: Since the gift will only be transferred upon the person’s death, they can still use the property during their lifetime
- Conditional: The donor can sometimes place conditions on the gift (for example, Jane will receive my watch upon her 18th birthday).
- Inter Vivos Gifts:
- Immediate gratification: Both the recipient and the donor would have the satisfaction of seeing the gift being used during the donor’s lifetime
- Irrevocable: Inter vivos gifts are permanent and irrevocable, meaning that they cannot be repossessed once transferred
- Tax breaks: Some inter vivos gifts can lead to benefits like tax breaks
Again, the key to proper distribution of personal gifts in a will is thorough planning. While no one can anticipate every possible situation in the future, it is better to handle gifts with sufficient planning rather than distribute them in a haphazard way.
Do I Need a Lawyer for Issues with Personal Gifts in a Will?
If you have questions about distributing personal gifts in a will, you may wish to consult with an estate lawyer for advice. Your attorney can help advise you on how to distribute your gifts according to the way you want. Or, if you will be the recipient of a personal gift in a will, a lawyer can help defend your interests if a contest or dispute arises.
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Last Modified: 06-23-2014 02:43 PM PDT
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