When Heirs are Imperfect
Passing your estate to an heir with credit problems or a gambling or alcohol addiction might not only lead to that wealth being squandered, but the inheritance could worsen the destructive behaviors.
Of course, you don’t want to disinherit your child simply because of their personal challenges. There are potential solutions that allow parents to control and incent behaviors long after they are gone, ensuring that a troubled child’s inheritance won’t be misused.1
一些常见的方法
信托是一种想法, since it can pass wealth to an heir while maintaining control over the how, 当, 在哪里, and why the funds can be accessed.2
When establishing such a trust, you can appoint a trustee, who is typically an independent, 第三方(e).g., trust company) or family member. Appointing a family member, however, may be fraught with problems. 假设说, who do you think may be better able to resist the pleadings of a desperate beneficiary? A close relative or a corporate entity?
此外, the trust can specify the precise circumstances under which money will be paid to its beneficiary, or it can specify that the trustee will retain complete discretion in the disbursement of funds.
构建思想
Trusts can also include incentives, such as requiring drug or alcohol testing before the funds are paid out, 或者, that a lump-sum payment be made only upon graduation from college.
To ensure that an heir is committed to change, lump-sum amounts can be paid out after prescribed periods of time, e.g.5年的戒酒. To encourage your heir to seek gainful employment, the trust might pay out a dollar for every dollar in wages. 另外, the trust can be written 在哪里by payments are made directly to service providers, like a landlord or utility company.
Trusts can be flexible in their design, but before moving forward with a trust, consider working with a professional who is familiar with the rules and regulations.
1. The information in this material is not intended as tax or legal advice. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation.
2. Using a trust involves a complex set of tax rules and regulations. Before moving forward with a trust, consider working with a professional who is familiar with the rules and regulations.
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