Occasionally I work with an estate planning client who wants to disinherit an heir. They’ve heard there is a trick to doing this correctly — and there is, but often not for the reason people expect. The truth is, in North Carolina, no one has a right to inherit anything from you — with the exception of your spouse (and then presuming that you do not have a prenuptial agreement waiving the right to inherit).
However, even natural heirs such as children who have no right to inherit, do typically have an expectation of receiving an inheritance. Upon discovering that they are not to receive an inheritance emotions can get the best of them, and they may begin to look for an excuse to challenge the Will or Trust Agreement. With this in mind, the appropriate protocol is first to eliminate by virtue of the terms of the document any possibility that the failure to include a natural heir was an oversight. Secondly, as your attorneys, at Clarity Legal Group we will take special care to record your instructions so that our notes with respect to your intentions and competence are crystal clear.
If I Do Nothing, Who Inherits My Estate Assets?
Of course all of this means that if there is someone you specifically do not want to inherit your assets, estate planning takes on a heightened importance. If you do nothing, the individual may inherit through that state’s intestate succession laws. When a decedent leaves behind an intestate estate, the North Carolina intestate succession laws dictate what happens to the decedent’s assets. For example, those laws dictate that the estate assets be distributed as follows if the decedent left behind:
- Children but no spouse – children inherit the entire estate
- Spouse but no descendants or parents – spouse inherits the entire estate
- Spouse and one child or descendants of one child – spouse inherits 1/2 of your intestate real estate and a portion of your intestate personal property (if you die with personal property worth $60,000 or less, your spouse receives all of it; if you have more than $60,000 worth of personal property, your spouse inherits $60,000 plus 1/2 of the balance). Child or descendants inherit 1/2 of your intestate real estate and any intestate personal property remaining after the spouse’s share.
- Spouse and two or more children or descendants of those children — spouse inherits 1/3 of your intestate real estate and a portion of your intestate personal property (if you die with personal property worth $60,000 or less, your spouse receives all of it; if you have more than $60,000 worth of personal property, your spouse inherits $60,000 plus 1/3 of the balance). Children or descendants inherit 2/3 of your intestate real estate and any intestate personal property remaining after the spouse’s share.
- Spouse and parents — spouse inherits 1/2 of your intestate real estate and a portion of your intestate personal property (if you die with personal property worth $100,000 or less, your spouse inherits all of it; if you have more than $100,000 worth of personal property, your spouse inherits $100,000 plus 1/2 of the balance). Parents inherit 1/2 of your intestate real estate and any intestate personal property remaining after the spouse’s share.
- Parents but no spouse or descendants – parents inherit everything
- Siblings but no spouse, descendants, or parents – siblings inherit everything
Can’t I Just Not Mention the Person I Want to Disinherit?
To be honest, no one should treat the intestacy laws described above as an estate plan. It is the most expensive way to administer and estate and for most people it is unlikely to be the correct plan. Of course, if it is your intention to disinherit a child, grandchild, or other nature heir, you need a Will or Will coupled with a Trust that specially describes what you want to do. It is not enough to simply leave the person you want to disinherit out of the legal document. For the reasons alluded to above, you want to protect against any misunderstanding or challenge of the legal documents.
The Right Way to Disinherit Someone
If the individual you are trying to disinherit would otherwise be considered a legal heir of your estate, you will likely need to specifically mention them and make it clear that you do not want them to inherit from your estate. If your intent really is to disinherit someone, therefore, you need to make that clear within your estate plan and you need to utilize all available estate planning tools and strategies to help prevent your Will from being contested. Clients I work with seem to have commonly heard that they need to leave the disinherited person some small amount as opposed to the larger share that they might otherwise receive. I don’t do this for my clients. In my judgement it is more straightforward to say “I have not included [the person] as a beneficiary under my Will or otherwise from my assets” and leave it at that. If you give a reason that is subject to dispute. If the reason does not relate to conflict I often suggest that the we include a statement that the decision “is not made out of a lack of love or affection”.
The Spouse’s Elective Share
While you can disinherit most people, your spouse is not among them. North Carolina, like many states, allows a spouse an “elective share.” In essence, this means that your spouse has a right to inherit from your estate without regard to steps you may have taken to disinherit him/her. Be sure you are clear on what your spouse is entitled to when you create your estate plan.
Contact a Raleigh, Durham, Chapel Hill Estate Planning Attorney
If you have additional questions or concerns regarding how to disinherit someone, please contact the Durham estate planning attorneys at Clarity Legal Group by calling us at 919-484-0012 or contact us online.