F. TO WHOM, AND HOW, SHOULD I LEAVE MY PROPERTY

1. Who Do I Leave My Property To?

Whoever you want to.  There are no real rules or restrictions that keep you from transferring property, at least in California, to anyone that you want to leave property to.  You are also not required to leave property to anyone that you prefer not to benefit.

The first question in any estate planning is the issue of who you want to leave your property to.  For those of you who have children, please go to "HOW DO I PROVIDE FOR CHILDREN OR OTHERS WITH PROBLEMS IN DEALING WITH MONEY" relating to provisions for children.  Those who desire to leave property to nieces, nephews, friends or other beneficiaries who may be minors should also review these provisions to make sure that you understand the various methods by which property can be left to minors.

Whether you would like to leave property to adult parents, siblings, friends, "live ins" or same sex partners, the issues relevant to your decisions are approximately the same.  You need to carefully consider the following questions:

1. Do I desire to distribute the property outright to the intended recipient or recipients at the time of my death, or do I believe it
    should be managed for their benefit by a third party?

2. If the person that is my principal beneficiary should die, who should take the property in their place?

3. Who would I believe would be the most appropriate to manage my estate at the time of my death?  (This person would likely be
    your trustee or executor.)

4. What steps do I have to take to assure that my property will be distributed in the way that I intend?

2. Can I Leave The Property In Some Way Other Than Just An Outright Gift?

Yes, you can.  These issues frequently arise when you are going to make transfers for the benefit of children.  Often children are legally unable to own property, and you are limited as to the ways in which you can make these transfers.  For more information, please review "HOW DO I PROVIDE FOR CHILDREN OR OTHERS WITH PROBLEMS DEALING WITH MONEY."

You may also want to restrict immediate access to property by adults who you intend to help.  This frequently happens when you are transferring property to an adult who is simply a spend thrift, who has a mental or psychological disability or who has a drug dependence problem which you do not desire to increase.  In these instances, we will generally create a specialized type of trust designed to direct the manner in which property can be distributed for the benefit of the person or persons you desire to be the beneficiaries.  There are a number of alternatives which are available in terms of how such a trust can be structured, and how property can be managed for the people you desire to benefit.  These concepts are also discussed more extensively in "HOW DO I PROVIDE FOR CHILDREN OR OTHERS WITH PROBLEMS DEALING WITH MONEY."

The use of such trust can cause increased administration expense and complication.  Establishing a trust for beneficiary generally means that the trust will have to file a separate income tax return, and that separate accountings will be done for the trust.  In addition, the trustee normally is compensated for services in that connection.  Finally, it is extremely important that you select a capable person to serve as the trustee of your trust who will comply with the terms of the trust instrument and your wishes.  See discussion under "Selecting a Trustee" in the section “HOW DO I PROVIDE FOR CHILDREN OR OTHERS WITH PROBLEMS DEALING WITH MONEY”

3. What If I Don’t Want to Leave Property to Certain People

In many instances my clients have indicated a desire to leave property to charitable organizations.  There are significant tax advantages to making charitable gifts.  In California you are able to leave a limited amount to charities should you elect to do so.

Clients also often ask about the ability to leave property to pets.  You are generally not able to leave property directly to a pet, but some of clients have elected to leave property to individuals with instructions to care for their pets, either in the form of the trust or in the form of the general statement of their intentions.  This is an effective method of trying to make provision for the ongoing care of a favorite animal.