Estate Planning for Tangible Personal Property
While preparing an estate plan there are many major topics to address and cover, including the disposition of your tangible personal property. You may be asking just what exactly is tangible personal property? It is property which can be felt or touched and moved. Examples include household goods, furniture, furnishings, personal automobiles, boats, jewelry, artwork, paintings, and books.
The risk of the not having a carefully tailored estate plan with regards to tangible personal property is that upon your death, the distribution of tangible personal property may lead to conflict, resentment and litigation among family members and beneficiaries. For instance, if all your tangible personal property is to be split among your children, what happens when each child decides they want the same item, such as mom’s dining room table? The table clearly cannot be divided. So, if each child feels a special attachment to the table, how should the distribution be resolved?
Or imagine if all your personal property was never distributed to your intended beneficiaries because you did not plan for all contingencies. For example, for couples that have children (jointly or from prior marriages), at the first death the tangible personal property is commonly given to surviving spouse and not the children. Now imagine what would happen if the surviving spouse remarries and the new spouse in turn inherits all the personal property instead of the children from the prior marriage and then refuses to give the children their mother or father’s personal possessions. If there had been some careful planning done by the parties, then all the resentment, hurt feelings and unintended fallouts could have been easily avoided.
When planning for tangible personal property we take the time to appreciate the parties involved and anticipate what conflicts might arise. Moreover, we help the clients identify specific items that should be addressed in their Trust or Will and carefully tailor those documents to achieve their objectives. We also provide the clients with resources to be able to make future decisions on the distribution of existing and newly acquired personal property without having to completely update their Trust or Will.
As such, it is very important that you understand what property of yours is personal tangible property, who you wish to receive it, its value – both sentimental and monetary – who the current beneficiaries of your property are, and issues which may arise upon its division and distribution. Frequently, these issues are overlooked and not properly addressed in a client’s estate plan. Or a client does not believe they have enough assets to justify creating a Will or Trust and consequently leave these issues unaddressed, when in fact the property is of great sentimental value, if not monetary.
Whatever the case may be, we recommend that you take the time to address these issues and have your estate or prior estate planning documents reviewed and evaluated by a professional to safeguard your intentions and prevent conflict among your beneficiaries.