With blended families, it is critical to get the rules down on paper while you still can. Below are a few common pitfalls that can arise when blended families fail to plan properly.
No Plan: Texas Law controls
When a person dies without a plan, the Texas plan is put in place.
Community Property - Texas law states that when a married person dies without a Will and leaves children from another relationship, the surviving spouse keeps only her one-half interest in any community property, including the family home.
The deceased spouse’s one-half passes directly to his children. While there are constitutional “homestead” protections for the surviving spouse which may allow her to remain in the property, she will officially co-own with her stepchildren, and when the property sells, will only receive her share of the proceeds.
Separate Personal Property - The deceased spouse’s children also keep two-thirds of the deceased spouse’s separate personal property, which may include vehicles, jewelry, artwork, or other items of sentimental value. A surviving spouse may keep only one-third of the deceased spouse’s separate personal property.
Separate Real Estate – If the deceased spouse owned any real estate that was classified as separate property, the surviving spouse inherits only a life estate in one-third of that property. The deceased spouse’s children inherit the remainder interest in that property.
Upon death of a spouse, many surviving spouses find it shocking that what they considered to be their entire net worth may be cut in half, or worse.
The “I Love You” Plan
Sometimes even when married couples take the time to plan, they may decide to get an “I Love You” Will, in which the surviving spouse inherits everything. With this plan, the surviving spouse then owns all the assets and can choose to do the right thing—or not.
The assets become owned by the surviving spouse who can then change his Will to do whatever he wants. The bottom line is if you want to make sure your loved ones inherit from you, include those provisions in your own plan. There are also provisions that can be put in place to protect both a surviving spouse and children from a previous relationship.
The Brady Bunch
Even in the Brady Bunch, If Mike doesn’t explicitly state that he intends to treat Marcia, Jan, and Cindy as his own children, he would effectively disinherit them if he died without a plan.
Finally, the public nature of a Will-based plan often invites will contests, which is why a revocable living trust is a good tool to consider to maintain privacy and prevent family conflict.
If you’re part of a blended family, or wish to learn more about other considerations when planning your estate, please contact Jennifer Solak at email@example.com or 713-588-5744.
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The information in this column, which was sponsored by Solak Legal as part of The Leader Expert Series, is intended to provide a general understanding of the law and not legal advice.
Readers with legal questions should consult attorneys for advice on their particular circumstances.
Jennifer Solak provides legal advice for families and businesses and may be contacted at firstname.lastname@example.org or 713-588-5744