Inheritance Planning: Family Heirlooms
Although numerous people think that estate planning revolves around the monetary assets that an individual may have, it is important to keep in mind that there are several sentimental aspects of estate planning that should always be kept in mind as well. It is important to remember that sentimental items can cause an even bigger rift in a family than the money. It is not uncommon for a family member to want a particular heirloom from a loved one when he or she passes away. If these heirlooms are not taken into consideration during the estate planning process, this could result in serious infighting between family members. Thankfully, there are several steps that you can take now to avoid this chaos.
Strategies for Passing Down Family Heirlooms
There are several strategies that you can incorporate into your estate plan so that you can meaningfully and peacefully pass down the family heirlooms that you may have. Here are just a few that you can consider:
· Talk to your family ahead of time
A good rule of thumb is to speak to your family ahead of time about the plans that you are making for certain heirlooms. This will ensure that they are not surprised by anything when you pass away. Also, this gives you a wonderful opportunity to be able to talk to them about the reasons behind your decisions and provide them with direction as to where to find these items when the time comes.
· Utilize a personal property memorandum
There are people who mistakenly think that they need to meticulously list all their heirlooms in their Last Will & Testament. However, ultimately your Last Will & Testament will become a public document once it is recorded with the Probate court and the odds are you will not want a list of all these items as public record. Instead of listing these heirlooms in your Last Will & Testament, you can utilize a personal property memorandum. A personal property memorandum is referenced in your Will but is a list that is separate and apart from your Last Will & Testament. You can use this list for all your heirlooms and state who you want to receive them. Although your personal property memorandum should be kept with your Last Will & Testament, it is not something that needs to be formally disclosed for probate purposes unless there is any type of conflict with your estate. A personal property memorandum should also be used in trust planning.
· Consider making gifts during your lifetime
As you get older, there is a possibility that it may be easier for you to simply gift some of these heirlooms to your beneficiaries during your lifetime. Keep in mind, however, that this is something that could cause gift tax issues. The current gift tax exclusion rules indicate that you can gift assets up to $16,000 during 2022 so if the value of these heirlooms is less than that amount, this may be a more suitable option for you. However, you should always consult with your accountant before taking this step.
Although there may be a monetary focus on the value of these heirlooms, the reason these items are heirlooms is due in large part to the emotional tie that you and your family has to them. This is something that is important to reinforce to your loved ones during your lifetime so that they do not lose track of this after you have passed away. Creating a written record of why the items are of sentimental value should be part of their legacy when passing them onto loved ones.
Discuss Your Inheritance Planning Strategy with Our Estate Planning Attorney Today
We are well-versed in the ins and outs of what it takes to put a comprehensive estate plan together. We go through a process of ensuring that every asset that you have, including heirlooms, are taken into consideration so that you have the peace of mind of knowing that your estate will be left to your beneficiaries in a way that makes you happy. Contact our office today to learn more about your options.
