In Latin, the term “causa mortis” translates to “because of death.” For estate planning and testamentary purposes, a gift causa mortis is when someone is given a gift of personal property by someone close to death. The classic example of this is when the gift is made when someone is on their deathbed.
However, the giver does not need to actually be dying for a gift to be considered proper. Instead, if the person knows that they are about to enter a situation where there is a strong chance of death, this can be legally sufficient as a gift causa mortis.
So what are the formal requirements for a gift causa mortis, and how does it differ from other types of gifts in estate and property law? Here is a short guide to gifts causa mortis.
- How do I Make a Gift Causa Mortis?
- What are some Examples of a Gift Causa Mortis?
- How is a Gift Causa Mortis Different from a Regular Gift?
- Can Gifts Causa Mortis be Revoked?
- What are Some Conditionality and Tax Implications with Gifts Causa Mortis?
- Do I Need an Attorney to Make a Gift Causa Mortis?
To qualify as a gift causa mortis, the law saws that certain requirements need to be met. While every jurisdiction that allows these gifts may use slightly different language in their written laws, a few basic elements remain common. These are:
- Intent: The first requirement is that the person must intend to make the gift or transfer to the person they want to receive ownership. If someone if forced to make the transfer under duress by threat of violence, blackmail, or some other action, the intent element can be invalidated;
- Delivery: The next requirement is that the gift must be delivered to the person it is meant for. If physical delivery is not possible or impractical at the time, symbolic delivery (such as through a document) is okay too. At that point, the owner relinquishes ownership to whatever they are gifting to the other person;
- Acceptance: The person receiving the gift must accept the gift; and
- In Anticipation Of Death: Lastly, the giver must make the gift causa mortis in anticipation of imminent death. We will look at some examples of this below.
One of the best ways to help illustrate how gifts causa mortis work is through an example. Suppose that Adam is about to have a serious surgery where the likelihood of his survival is around half. The night before the procedure, he calls his best friend Bob over and tell him that he is going to give him his collection of baseball cards. Adam then hands the book of cards to Bob, who takes them home with him. This is a good example of a completed and valid gift causa mortis.
The legal counterpart to the gift causa mortis is one made inter vivos, which is Latin for “between the living.” Inter vivos gifts are more commonly known as just regular ones, where one person gives something to another, with no thoughts of or threats of death on their minds.
When it comes to making an inter vivos gift, the legal requirements are very similar. The major difference between these two types of gifts comes down to revocability, conditionality, and tax consequences.
One major difference between an inter vivos gift and one made causa mortis is whether or not the gift can be revoked by the giver. The laws controlling causa mortis gifts state that the gift is revocable (can be taken back) at any point while the giver is still alive, completely at the donor’s discretion. The actual right to keep the gift is only complete when the person giving the gift passes away.
With an inter vivos gift, once the transfer is made, there’s no turning back. The gift then becomes irrevocable, and the recipient has full legal ownership of the property.
The second aspect of revocability with causa mortis gifts is that there are situations where a gift can be automatically revoked. If the situation that caused the giver to be in a condition of impending death passes, then the need for the gift causa mortis is eliminated and it is automatically revoked.
Another important thing to note is that the person on the receiving end of the gift causa mortis must survive the giver in order to legally obtain ownership to the property. This means that the potential receiver’s estate and heirs has no legal interest in it. With inter vivos gifts, since the legal ownership has already been transferred, it will then be distributed to their heirs according to their will or through probate law.
In terms of tax implications, gifts causa mortis are treated as if they were bequeathed via by federal law. This is because the gift is not technically complete until the giver has passed away.
Estate planning can be both emotional and complicated. So, if you are looking to make a gift like this, seeking out the help of an estate planning attorney is the best way to make sure all your wishes are properly legally documented.