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What if the beneficiary dies before getting an inheritance?

Estate Planning & Administration, Probate

Probate is anyway a complex process. Even under an ideal scenario, completing the process demands a mountain of time and patience from a person. What when things don’t go according to the plan? Completing the process might be a tough nut to crack for the person. Let’s talk about the scenario “What if the beneficiary passes away before he/she gets an inheritance”?

While life is unpredictable, this situation cannot be ruled out at all. The testator has to prepare the will considering every situation in the mind. Chances are there that the beneficiary passes away in the survivorship period too. Now, what is the survivorship period? It is a specific timeframe after which the beneficiary can inherit the gifts after the testator passes away.

The Impact of Beneficiary Passing Away Before Getting an Inheritance

If the beneficiary passed away before the testator, the gifts return to the testator. The testator is highly recommended to name the secondary beneficiary as soon as the beneficiary passes away. This will make the secondary beneficiary the receiver of the gifts after the testator passes away.

So, how to name the secondary beneficiary? It’s not that tough. Let’s take an example. You can write “My wife Jenny will be getting my estate after I pass away. Also, I would like to name my daughter Catherine as a secondary beneficiary if any unforeseen conditions prevail.” According to this statement, Jenny will be your primary beneficiary. She will be receiving the estate after the testator passes away. And if unfortunately, Jenny passes away too before receiving the inheritance, Catherine will be receiving the estate.

What if there’s no Secondary Beneficiary?

This is another scenario. Here’s where complex situations arise. If the will doesn’t incorporate the secondary beneficiary or if the secondary beneficiary passes away too before receiving the inheritance, the term “lapse” comes into the picture.

Now, what the “lapse” is? Ideally, the testator would want to give his estate to the deceased person’s spouse or child. But under lapse law, the situation changes a bit. According to this law, the gifts are reverted to the residual estate. If you don’t want this thing to happen, then it always wise to shield your will with the “anti-lapse” law.

So, to summarize, if the secondary beneficiary is not mentioned in the will or if a secondary beneficiary has passed away too, there arise three conditions: the estate goes to the residuary beneficiary, the “anti-lapse” law comes into action, or deceased person’s heirs become the person to inherit the estate and it will be considered that there was no will at all.

Anti-Lapse Law

You need to know this law to ensure that your estate isn’t reverted to the residual estate. The
Florida Anti-Lapse Law states that if a person’s beneficiary passes away, the immediate family
members of the beneficiary are liable to inherit the estate.

However, the Anti-Lapse Law commonly applies to:

  1. If the deceased beneficiary was the will-maker’s grandparent or a direct descendant of the grandparent.
  2. If the deceased beneficiary was the left children of his or her own.

However, it becomes important to know that Anti-Lapse laws usually don’t apply to the people not having blood relations with the will-maker. So, if no secondary beneficiary is named in the will and if the surviving members don’t have blood relations with the will-maker, the will automatically pass as if there was no will.

So, let’s summarize the anti-lapse law with an example. Let’s say Jenny left the estate to her daughter. But unfortunately, her daughter passed away before receiving the inheritance. In this case, her daughter will be the beneficiary here. Every state of the United States, except Louisiana has anti-lapse law.

Residuary Beneficiaries

Firstly, what does the residuary beneficiary mean? Let’s understand it with an example. In a will, Mark mentioned that the cat and the bed will be taken by his sister. And his wife will inherit the rest of the estate. Here, Mark’s sister is a specific beneficiary while his wife is a residuary beneficiary.

Usually, the wills do mention the residuary beneficiary. While if the residuary beneficiary is not mentioned in the will, it becomes necessary for a person to see if the “Anti lapse” law applies in the state.

What if residuary beneficiaries die before receiving the gifts? If the residuary gifts are distributed to the group of people, and if one person dies, remaining members of the group can share the gifts. While if the residuary gifts are assigned to a single person, and if he dies, the Anti-Lapse statue comes into action.

What If Anti-Lapse Law Doesn’t Apply?

What if the anti-lapse law doesn’t apply in your state or in your case? If the anti-lapse law doesn’t apply, the gifts usually go to the residual estate. If not to the residual estate, the gifts go to the will-maker’s heirs.

You might face some issues in understanding the laws and conditions of your state if you come across this scenario. And it’s always wise to take assistance from an expert to ensure a smooth process for yourself. Reach out to the Law Office of Michael Heider at 727-235-6005 or send an email and ensure you get the best and the most reliable consultation for yourself.