Mar 15, 2014

Another head-scratcher of an estate plan

Clients frequently ask if they are legally obligated to leave assets to certain people. The question usually involves an estranged child. Here's the answer: Under Florida law, a spouse and minor children are entitled to a percentage of a decedent's estate. The government is also entitled to its due if your estate is taxable. Creditors get their piece of the pie, too. But after those obligations, you decide who to name as a beneficiary. After all, it's your money.

Unusual beneficiary choices make headlines. My late client, Maria Woods, a German immigrant, left the bulk of her estate to the U.S. government out of appreciation for the opportunities this country provided her. A more recent example is the late Robert Gerin of Buffalo, New York, who died in 2010. The Buffalo News reports that Gerin, a New York-born truck driver and cab driver, never married and had no children. He had a girlfriend and some distant relatives, including an uncle in Florida. His will directed that his assets, about half a million dollars mostly in mutual funds, were to be split between the U.S. Treasury and Consumer Reports. Unlike Maria Woods, who made the reasons for her choices quite clear to me, no one seems to know the logic behind Gerin's choices. According to Consumer Reports, Gerin was not even a consistent subscriber over the years. Even the attorney who drafted his will could not tell the New York Surrogate Court precisely why Gerin insisted on doing what he did... only that he was emphatic about it.

While gifts like Woods' and Gerin's are unusual, they are not unheard of. Brad Benson of the Treasury Department told the Buffalo News that in 2013 the Treasury received $1.76 million in bequests. The Treasury also maintains a "conscience fund," to which people contribute when they feel guilty about having defrauded the government and gotten away with it. 

No way is this a trend, though! Blood is thicker than water and people are always going to want to take care of their own families as priority number one. But it is interesting!

1 comment:

Louise | Philadelphia Estate Planning Law Firm said...

This is absolutely interesting! It seems odd that there are people who leave their assets to strangers. If I will be able to accumulate wealth in my lifetime, I will definitely make it known through documents that my chosen beneficiaries will be entitled to them. It makes a difference to stay in control and value the people that are closest to you.

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