Occasionally, clients ask their estate planning attorneys about how to leave behind shared gifts. This is an especially common scenario if you wish to pass along an asset to your children. Shared gifts are those that left to two or more individual beneficiaries.
Each of those beneficiaries receives a portion of the property ownership. This is different than stipulating inside your will and other estate planning documents that you wish a particular asset to be left behind and sold while having the profits divided between the beneficiaries.
All of the beneficiaries with a shared gift instead own the property themselves. If you are contemplating leaving behind a shared gift, whether to children or to other beneficiaries, there are a few important considerations you must review first.
For example, what portion of ownership does each beneficiary receive. This should be spelled out directly in your trust. If you do not spell out the percentages of ownership available to each beneficiary, it is typically presumed by those reviewing your estate planning materials after you pass away, that you intended equal shares.
There is no reason not to go into details on this matter. Furthermore, consider who will maintain control of the property. If the beneficiaries intend not to sell it and to keep it, those beneficiaries must agree about how the handle their shared ownership.
They might wish to sell it and split the proceeds or want to keep it, but in the event that the beneficiaries are unable to agree on how to use the property, they could end up in litigation. The more you discuss your intentions to pass on this particular item of property to future generations, the easier planning will be.