From Our “Ask a Question” Mailbag: “I remarried a wonderful woman with two children. I want to include my step-children in my estate plan. As an estate lawyer near me Philadelphia, do you have suggestions for Estate Planning with Stepchildren?”
Peter Klenk, Estate Planning Lawyer, an Estate Planning Lawyer Near Me Philadelphia.
Estate Planning with Stepchildren.
A second marriage brings unique challenges, especially if your new spouse has children. Most people focus on the obvious; negotiations with the former spouse, visitation, and the politics of being a stepparent. You have picked up on one of the more subtle concerns; estate planning with stepchildren. Ignoring estate planning with stepchildren can lead to unnecessary conflict. If your goal is family peace, then a well thought out estate plan is essential.
Considerations When Estate Planning with Stepchildren.
First, you must decide if you wish to include the stepchildren as heirs or not. There is no legal obligation to include stepchildren. You can, legally, exclude them. Often couples in second marriages agree that each parent will leave some funds to their children, but not to stepchildren. If so, you should consider making this clear in your Wills. Further, consider explaining this to the children and stepchildren while you are alive. Managing expectations can reduce the chance of future conflict.
Second, if you decide to include stepchildren, work with our Estate Planning Lawyers to arrive at the best plan. The best strategy will depend on many factors, such as what assets you own. For example, if you are in Pennsylvania, there is no inheritance tax on life insurance going to stepchildren, but there is a 4.5% inheritance tax when leaving cash. Another consideration is arriving at a plan that separates stepchildren from your estate plan to avoid conflict. Such as including them as IRA beneficiaries rather than in the Will. Including stepchildren in the Will requires giving them notices throughout the probate process, while leaving them a portion of the IRA does not provide them with access to probate information.
To Include or Not Include as Fiduciaries.
Giving your stepchildren an inheritance is one question. The completely different question is to include or exclude them as a fiduciary. Your estate plan likely includes Executors, Trustees, Agents, and Surrogates. We would work closely with you on deciding if stepchildren should be in full control, or serve as “co” fiduciaries in these various positions. Individual competence, as well as family politics, come into play. Strive for family peace, when possible.
In Conclusion: Estate Planning with Stepchildren
Every marriage (first, second, third, etc.) needs an Estate Plan. Stepchildren bring their own, particular challenges.
Follow this link for more information about Estate Planning With Stepchildren. My website has much more information. If you wish to talk in more detail, learn about Our Estate Planning Process; Efficient and Easy.
Let our Estate Planning Lawyers help walk you through what can be a confusing process. To begin with, call to speak to one of our Estate Planning Attorneys. By all means, our lawyers are ready to answer your questions. In fact, feel free to contact our office for a free consultation. Ultimately our goal is to make the process as painless as possible!
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