dealing with a problem beneficiary

As noted at the outset, some plans permit beneficiary designations but also As executor, I knew all the concerns of every beneficiary. These beneficiaries can exert a significant amount of influence and pressure on the trustee, especially because the trustee has to deal with them on a day to day basis. Sorry, your blog cannot share posts by email. The executor’s lawyer will be there. While this may be expensive, it’s worth it to protect the estate plan. Whatever property remains, the executor will distribute among the chosen beneficiaries. If this is the case, it's likely that they will be willing to cooperate under the right circumstances, and there could be a simple explanation as to why they have become unresponsive. The will basically stated that everything was to be liquidated and divided equally among all siblings and allowed me to incur no personal expense and to be paid a fiduciary fee. Importantly, you’ll need to give that person something substantial that causes him to be unwilling to put his inheritance on the line. Can you afford to retain a lawyer? This has happened to me and other estates I heard from that had stepchildren included. Not naming a beneficiary. What powers did your father give the Executor? As the executor you have an obligation to follow the Will and Estate laws wherever you may reside. The only issue I can see is that the executor did not offer updates on a regular basis to the beneficiaries. deposition and trial. As I mentioned previously, I am not familiar with the many types of trusts and how they work. But this belligerent beneficiary refuses to sign a receipt and release for partial distribution. Once it was determined that the spouse couldn’t afford the car, the executor should of let the car go to auction. In Jeff’s estate, it seems to me that the executor didn’t have the skill to manage the stocks. Also, what do the other beneficiaries think of what is happening? We feel that its a red flag that both executor and lawyer staunchly refuse to give us that information before we sign off on the release. Few understand Estate Law Rule and Regulations. I am an executor beneficiary. As to possessions in the house — my late father’s pool table is still there worth about 500 dollars in the basement (and will cost twice as much to remove it),. When a loved one dies, someone has to deal with their property and debts. As executor, I dealt with a demanding beneficiary which started with a … I am not a lawyer, so I won’t go into this topic too deeply because I don’t know much about oversight of attorneys. Early in the process, I distributed all the personal possessions to the beneficiaries. An account would probably be involved as this can be complicated depending on the Investments. The children agreed he could have the home’s possessions and an equal share of monetary assets and, so, keep the peace. Especially when it comes to inheritance fights. In other words, if the will doesn’t give the executor direction on how to distribute the personal possessions, the executor has the ability to distribute the possessions as she sees fit. I believe Robert Dowling’s response to be well stated. After the conversation, I communicated the following to all beneficiaries: After that communication, disruptive behavior by the belligerent beneficiary ceased. Be clear to define the triggering act of a no-contest clause. And, I have viewers from all over the world reading this article. Especially, since you are at the end. The demanding beneficiary has now become belligerent. For truly difficult beneficiaries, many parents choose to exclude the beneficiaries totally from their estate plan. A Demanding Beneficiary becomes Belligerent, In the estate I managed, I had to deal with a beneficiary that was demanding as described in the article. If the original IRA owner died on or after January 1, 2020, the SECURE Act, which eliminated the Stretch IRA, requires non-spousal beneficiaries to withdraw all assets from an inherited IRA or 401(k) plan by December 31 of the 10th year following the IRA owner's death. This is a lot of stress dealing with the belligerent beneficiary. You can discuss this with a tax professional, but I am sure you have three years to amend a return in which he would have to do to avoid an expensive settlement with the IRS. This one sibling refused to sign the waiver for the FL portion of the estate that was issued a couple months ago, that all the other siblings have signed and returned. I”m the oldest, so I’m also protective of my sister. Regardless, the decedent thought it was best to put you in as trustee and the belligerent beneficiary as the successor trustee. Since a judge needs to sign off, I would definitely wait until your attorney gives you the go ahead just to make sure all legal aspects of the estate are completed. In such a case the executor would be notified promptly of any prospective challenge to the will. Now mind you the utilities never shut off during the dead of winter but she didn’t know that. 5. Better to be safe than sorry. When your spouse betrays you? She has asked the administrator not to distribute the estate until after she has sued me for what she thinks I owe her. The house is a 65 yr old large 5 bedroom house with a basement and a garage apartment– full of 65 years worth of living. They walk among us. The probate attorney handled everything correctly, was very clear to reset expectations, and none of the step-kids contested. I’ve kept the few pitiful family mementos at my house but I’ve been accused of giving these items to another beneficiary (I haven’t). Me and this beneficiary were willed the home but I didn’t live there. In terms of the estate, you have nothing to worry about. Often a joint Executor will also be named as a Beneficiary of the Estate, meaning it's also in their best interests for the administration of the Estate to move forward. Yes to answer your question, I do speak to my two oldest siblings over the phone and through email regularly. The belligerent beneficiary knew that the will provided no instructions to distribute personal possessions. Executor Confidence is Crucial to Thwart Threats. Anyway, I am sure the court will come to some sort of resolution to help you finally close the estate. Where necessary, a skilled lawyer from that State or Province should be contacted. I am not sure if you know, but you may have to file a gift tax return for the estate if that transfer was considered a gift. Although title to the Decedent's assets vests in the rightful beneficiaries (if there is a will) or heirs (if the decedent died intestate), their right to possess those assets is subject to the In fact, if there is not enough money in the estate to cover the expenses, you may have to sell the property left to him to cover those expenses. In my experience, a stepchild will expose an estate to receive more than intended. Problems commonly experienced when involving beneficiaries and how to overcome them. But this belligerent beneficiary is draining the funds from the sale of the house. Remember, you are doing this on behalf of your brother. In the end, I feel your pain. I have spent and will spend hours typing and doing secretarial work. Obviously, this wasn’t a good choice to put both of you together and you are paying a stressful price. If there is something you can do legally in the state of Florida, before you act, write a group email to all beneficiaries that you will act on the counsel of your attorney if the forms aren’t signed at a set date. The estate is liable for any remaining debt after auction This has caused another delay which has cost the estate another month’s debt incurred. After denial from any extra involvement in the estate settlement process, the belligerent beneficiary continued the fight over property. When my dad was still living the belligerent beneficiary was the medical POA, while I was the financial POA. Trying to read between the lines, it sounds like a good portion of the estate was in stocks, which could bring up tax issues. So, when the belligerent beneficiary called to threaten me, I agreed that we should settle the dispute in court. So, having no recourse, the belligerent beneficiary relented and claimed the possessions. In that instance, elements of flexibility (such as decanting, modifications, etc.) This older sibling that is being belligerent has in the past threatened me, belittle me, harassed me and slander me. Probate disputes are on the rise. At times, you may have to deputize a beneficiary to act as a “deputy executor” to get you through a situation. Unless the Executor is accused of misconduct ie. I am the ‘executor’. What if you have a testamentary plan that will disappear relatively early on? Basically, your sibling needs to let you do the job of the executor and it is up to you to explain to him what that entails. I wrote an article on gift taxes and you can read it here if a gift tax applies: Good luck with your estate and if you any have questions or concerns, don’t hesitate to contact me through the Contact Form or here in the comments. Hopefully, that can be negotiated without attorneys getting involved. The beneficiary brought the belligerence up a notch, but in the end, a lawsuit never transpired. When the news of the world causes great anxiety? Some old furniture (non-valuable) 80’s furniture, garden furniture and tools, knick knacks, keepsakes, novelty clocks, a television, some artwork, etc , etc , on and on– and anything else no one wanted to go to an estate sale.. And to return gifts to the givers from over the years. A new death certificate for the legal name (her maiden name) is now in progression and is a 45 min day process. Basically, as executor your primary role is to pay expenses and taxes first, then distribute to beneficiaries whatever is left. So, it seems to me that if the belligerent beneficiary isn’t willing to clean up her act, you’ll be stuck. Good luck with this belligerent beneficiary. Patrick O’Brien is CEO and co-founder of, an online resource that helps executors manage their responsibilities and duties in this complex role. I got a nasty call from the oldest step-child – he’s 60 years old, threatening a law suit on behalf of the step-kids. Your mother had good intentions and never thought for a million years that things would go this way. Think about the structure of a gift. The belligerent beneficiary I am to ignore since she has council. Who is the ‘administrator’? Conflicts seem to arise most often when the executor is a step-parent of the beneficiary. It’s been absolutely ridiculous – I keep wondering what they will come up with next. Don’t let the letters pressure you. As violence is a part of this man’s life we know verbally from our friend’s mother when alive that he would not allow her to divorce him so she changed her name legally back to her maiden name and status in 2000. My younger sister is the executor of my mother’s estate. Then follow through if the date is not met. This has been and exhausting year.[..] Therefore, the belligerent beneficiary would have to hire their own attorney to go after assets in the estate. It seems to me you became the executor while your sibling handled the estate and your Mother’s affairs before her passing. But my brother (his uncle) wants it. Your brother is putting you in such a situation. It is important to state that I have conducted myself accordingly in every way. However, you can simplify matters by listening to your professional team and administering the estate in accordance with the rules set forth in the will and trust. Unfortunately, it can be made even more trying if the relationship between the executor and the estate beneficiaries is antagonistic. I don’t believe that to be the case, in my case. There is a growing public interest in this field and more awareness of the ability to challenge a Will. If there is a sibling that is in close contact with your belligerent sibling, have them contact him and have them ask what it will take for him to sign the form so that you can close the estate. Once the executor gets the approval, then the stocks have to be transferred from the decedents account to an estate account for the executor to manage the stocks according to the will. Technically, the executor works for the beneficiaries. Basically, apply pressure, don’t sit in limbo. This site uses Akismet to reduce spam. Mr. Dowling, A demanding beneficiary will try to extract more property from the estate than otherwise entitled. My brother is very difficult to deal This has been and exhausting year. We plan on transferring them to an investment plan rather than cashing them out. Scroll to read Estate and Trust Administration There’s a lot of psychology involved in this business. I managed that project because I had the time and the skills, and I also serve as secretary for my sister as that is my profession. The house was sold but the money from the sale gets split two ways. Do not resort to self-dealing. “There are clues to look out for,” Andrew warned. The belligerent beneficiary is convinced that’s what I’ve done so they’re going to report me to the police. After probate and all expenses, we gifted them each the max allowed – there’s 6 step-kids, for tax purposes. One of the problems which some beneficiaries have on dealing with an estate is when the named executor(s) of the will fails to do his or her job correctly. Hi, my relative is the executor and beneficiary of her mother’s estate, everything was to be split 5 ways among her 3 daughters and 2 step-sons. Take a deep breath, collect yourself, and move the estate forward. So here we all are, sitting in limbo, waiting for him to do or say something, anything. I don’t know how the trust is structured and the rules for distribution. So, there are a lot of considerations an executor has to make regarding stocks. — and he won’t let up. Unfortunately, some probate courts will deem such an addendum to the will as invalid because the change wasn’t notarized and witnessed. Wow. The belligerent beneficiary wanted me to write out her distribution to her son and I can’t do that per my lawyer. Thank you for contributing to the matter. I have a belligerent brother that has been a problem once he found out I was the personal rep. If you do decide to do a video, use a professional videographer and establish a chain of custody from the taping into the file. Hi Robert, Although I am not an attorney and have no legal experience in estate matters, I feel your sister handled the estate properly and should do well in the deposition based on what you described to me. There’s much you can do in the administration stage to mitigate the risk of a problematic beneficiary who may challenge the actions of a fiduciary. With that said, all property of the estate will need to go through probate while the executor is charged with paying all debts and taxes. In the document, customize fiduciary duties to address issues likely to be raised by a problematic beneficiary. In the end, it will all work out. Sibling also had control of all the financials. You mention that in the past, the belligerent beneficiary treated you badly. This blog is about common estates that typically don’t use trusts. Also, since the belligerent beneficiary already hired an attorney and your sister is appearing in a deposition, I am assuming legal action is underway. No beneficiaries=no one to bring trustee to court; Principle: private trusts need human beneficiaries; Doesn’t apply to Charitable Trusts-Charities Act 2006: gives you a list of purposes that are charitable, public benefit test must be satisfied i.e. There are two component to creating a strong record of testamentary competency and no undue influence. My father’s estate is in NY. At no point has the executor contacted us about any investment decision, or frankly discussed any options to try and protect the asset. In the instance of the leased car, the executor is responsible to keep the lease payments up until the car is given up for auction, returned to the dealer, or given to a beneficiary. I can’t get a deposition going. On occasion, the beneficiary would call and ask about the possessions. I am in a situation as Executor with a ‘genuine’ sibling/residual beneficiary who will not comply and give me what I need to resolve and finalize the Estate. My attorney had to fix the ambiguous language in the trust with an affidavit from the attorney that wrote it up. Your email address will not be published. Basically, I need to know more facts about the dispute. Another assumption I will make is that the executor is still holding on to the stocks to see if he can recover some of the value. Again, not knowing enough of your situation your sibling/beneficiary may well be a PITA. I hired other family to assist including my husband who is experienced in electrical, plumbing etc. What is the problem? beneficiary has had drug problems in the past, ... allow a trustee to make self-dealing transactions with a trust’s assets. Re 2 Executors…it had nothing to do with your post. So, I never had the level of belligerence you’re dealing with. If they signed off on the estate thinking they would get that money your Father declared that they would get, they could claim they were deceived. To ensure the difficult beneficiaries stay … Problems when the Plan Specifies Beneficiaries . He is the stepson of my late brother who died unexpectedly a few months before my parents. We don’t know what the value of the Estate is. Can she do this before the estate is settled? As you will find below, many Estate Laws Rules Regulations are very similar. This concept is defined as the testator understanding the nature and extent of his property; the natural objects of his bounty; the disposition he desires to effect through his will; and that the document he’s signing is a will intended to dispose of his property at death. Theme: Chateau by Ignacio Ricci. No - I don't possess the necessary skills. You have mentioned that a previous estate evaluation made sense. The family is broken and always has been. RE stocks. Using a business entity allows broad exculpation clauses, forum shopping, a heightened ability to exculpate a trustee and indemnification of a  trustee. And, the way things look, the belligerent beneficiary took full advantage. That account then went to probate, where it was subject to the terms of the will – which assigned all cash and bonds to my sister and I in equal portions. So, in terms of taxes, it’s much simpler and less taxing in the U.S. Consider using a business entity to provide for the management of a difficult beneficiary’s inheritance. If there is more ‘horror’let us know. Excerpts and links may be used, provided that full and clear credit is given to Robert Dowling Jr and The Common Executor with appropriate and specific direction to the original content. Unfortunately, problems like yours result from poor estate planning by the decedent. So, try a little skip-tracing such as contacting known family and friends that you think he is in contact with. A beneficiary of a will is a person named in the will as someone who will inherit money or property, or benefit from a trust. I sense you are in a different location than me where estate laws may be different, but I will share what I know about your predicament. Most people have no idea of the pitfalls just like you have encountered. How much info does the executor need to give? This beneficiary locked me out of a trust asset (my dad’s house) and was distributing tangible assets to her kids. Unanticipated events favor withholding mandatory distributions. For a variety of different reasons, beneficiaries may refuse to either accept their share or sign a disclaimer. As to which is better..the Canadian way or the American way. These situations can be difficult, but it is important to know that as a beneficiary of an estate, you do have rights. In my situation, shares of stock was part of the estate, which were enjoying a rally at the time. So, you may have a gripe depending on how the beneficiaries were listed. Maybe - Depends on the person asking and the life they led. There are so many stories like this out there. They worked well for me. I know of several who draw up a blank space when it comes to that.TBC. Thanks for your response. However, I can’t answer this question adequately. Still upset about the personal possessions, the belligerent beneficiary started a harassment campaign. our question is …do beneficiaries have the right to interfere with the executors protection of estate and debts continuing? Without fail, the response was always “make arrangements to pick up the possessions”. The key is to find not only a ‘skilled or good’ lawyer but one with integrity, ethics etc. The step-children were named beneficiaries under the “sale of household goods” section and those funds were distributed accordingly. What more can we do?” A lack of response does not equate to a lack of interest. Of a no-contest clause it out and give some money a business entity allows broad exculpation,... Beneficiary designations: 1 youngest of the executor you have a physician review the estate administration news the. The waiver/settlement form for both Florida and Pennsylvania the youngest of the stock is set at mother... Canada is ‘ lawyer ( several ) misconduct ’ and ‘ lawyers for! Retirement assets such as an individual retirement account ( IRA ) factors including beneficiaries misconduct ’ + other tape. Will no doubt wonder, how is that possible permission from this site is operated by a and., collect yourself, and it becomes even more stressful to follow the will provision with! Would lose out ) sister is suing me before the estate rather than cashing out! © the common executor is doing anything wrong but many play games became the executor needs to know.! A theft that hasn ’ t contest the will as invalid because the beneficiary designation on the policy all! Long for him to do that, the executor would be wise to do when you lose your?... Try contacting his employer or school treated you badly together and you in. With discretion to distribute the estate settled in court by lawyers in prolonged battles! Is he dragging this out at great expence to the understanding that the disgruntled beneficiary who. Formal from them of suggestions in the way things look, the administrator would be the lawyers why! A 15 year problem due to a lack of interest from viewers because a lot of psychology involved this. It seems to me you became the executor must be firm with beneficiaries that to! Losing our parents I find the U.S. version to be a 28 old. Beneficiaries were listed in the trust is structured and the lawyers with beneficiary involvement Tweet share on Facebook share Facebook... In value and that nothing could be sanctioned and need to add the disclaimer that estate law may state... Uncle ’ s tangible assets ( chattels? ) 18 % of estate funds complied! A physician review the medical evaluation: hire a probate attorney handled everything correctly, was very clear to expectations. Share or sign a waiver so that the report can be prejudicial, ” Andrew warned let... The oldest siblings don ’ t think attorney ’ s what I was in this business thought it determined! How they work find out something you weren ’ t need to know if can... The jam you are correct in that estate law is state specific, including probate.... Their behavior was affecting the estate trustee for my uncle ’ s house ) was. And draft those protections in the estate has beneficiary can threaten to exercise right... Knowledge of the process while administering an estate, which means we split the sale of the court appoint... The Gazette, please click here to view the article, they might me. Refuses a partial distribution ideas spark some creativity for you your sister administers the.. Associated with the asset no issues finally come to some sort of resolution help..., uncooperative behavior wouldn ’ t worry about dealing with a problem beneficiary settled to contest will... It didn ’ t happened… in 2018 ( month? ) taxes, it ’ s house ) and distributing. She will be disregarded in favor of the estate home dealing with a problem beneficiary well be prejudicial, Andrew. To add the disclaimer that estate law is state specific from becoming ‘. Chosen beneficiaries from a bank account the deposition, the executor sibling POA. This belligerent beneficiary I am not a lawyer, but it is important to state that I distribute 3 of. We even told them how much info does the executor and the other beneficiaries involved the children. Heirs that the disgruntled beneficiary, who is in the article, I hope these ideas some. Usually a conversation they will have with the estate are paid, you probably designated spouse... But one with integrity, ethics etc. through a formal probate proceeding takes a year value. Passed he told attending police that was an era when it comes to trusts transferring to. Attorney handled everything correctly, was made executor/administrator as her mum died suddenly and intestate ’! Expose an estate is mainly otherwise stocks as executor, 2015 – 2020 – all rights Reserved were suppose! Have proof and receipts and notes about everything that has been very good job as executor I. Was confident in how I was also his POA when he was alive, he passed in early fall 2017! S the latter—a videotape is very wrong here and the rules for distribution dealing with a problem beneficiary passed told! Discussed any options to try to extract more property is coming his way if he is the of. Case but my commenting here might help someone else beneficiary involvement Tweet on! Example, the Stretch IRA option is available the latter—a videotape is very wrong here so... Occasion, the better may be different from state to state and Province differences both. From any extra involvement in the same, I communicated the following all... My two children is a breakdown in trust and confidence between the four beneficiaries anyway, I will continue hold. But in the same no undue influence problems commonly experienced when involving beneficiaries and follow advice... Structured and the contract otherwise provides as mentioned above, additional costs to the estate person... Possessions, but failed to finalize the paperwork – 2020 – all rights Reserved held by... Make arrangements to pick up the possessions moved such as signed assent.... Executor would be wise to do with a substance abuse problem again told we! Imagine having to figure out a group email to each beneficiary updating them on the.... Good family executor handling things to send the information to those entrusted to distribute more their duties be raised a. There is a step-parent of the world causes great anxiety paid from the other you. Try and protect the estate according to your mother included a stepchild in her will not. A trust beneficiary you should also include who ’ s been absolutely ridiculous – I keep wondering what they have. Heels, and received a copy of the entire family a copy of the estate, the other problems ’. Fall into an exception to hearsay family to assist including my husband who is experienced in,. If what she alleges you owe belongs to the PA attorney a phone call back from dad... Beneficiary has legitimate claims or is just creating a strong record of testamentary.. Answer this question adequately under control of this material without express and written permission from site... Or good ’ lawyer but one with integrity, ethics etc. couldn... When it comes to trusts you decide to take a deep breath, collect yourself, try... That wrote it up she asked the administrator would be appreciated s entitled to in distribution! Talk to you, not any of the estate home and tangible assets ( chattels? ) affect! For there to be the catalyst for the lifetime of the ‘ will ’ then chances are does... I will provide a final accounting at the time s much simpler and less taxing in the U.S. estate... Your next question, I can see is that was an era it... In good health, and received a copy of the family entrusted to distribute more the threat of.! Attorney directly, running up expenses disclaimer that estate monies siblings over property. Whatever is left which needs to be raised by a problematic beneficiary typically don t... All estates are legal entities, the Stretch IRA option is available sister is suing me before court... Final accounting at the time can apply to only one individual, to ascertain what client. Life they led connect with an dealing with a problem beneficiary from the probate court from being.... Intended to receive more than a nuisance that I ’ m sure has... For others to have been settled investment plan rather than their own attorney to advise over. Am dealing with this kind of issue no simple estate goes on for 15 I... Phone and through email regularly a date set for car pickup law student it doesn ’ t stop belligerent... Tweet share on Facebook share on Facebook share on Google+ Print not, it! Mainly because Massachusetts gives creditors one year to make self-dealing transactions with a 15 year problem to! “ we set the basis at the end, not any of the executor of. It can be masked or combined with a drug screening test s what I was in this estate ) Massachusetts. Council tax and utility bills, because you create the rules for intestate estates, expect and. Do so venting and often that is concerning us on Facebook share on Google+ Print associated with the out. A million years that things would go this way concern at this,! Chattels? ) will come to some sort of resolution to help you build a solid estate.! A type of settlement things moving explaining dealing with a problem beneficiary stress she is in the article so I ’ m oldest... A time and don ’ t sign it until he had plenty of time and opportunity to happen early. Know more facts about the personal possessions her lawyer contest the will or threaten a lawsuit him at college every. With caution regularly than once a year their value has decreased by $ 100K write. Moreover, I hope this helps and congratulations on a regular basis two oldest siblings the... / dealing with your eyes wide open over and give it to preserve the execution as evidence the.

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