Ch. 31: Wills and Trusts – No. 1
Clarkson et al.’s Business Law: Commercial Law for Accountants (1E)
Will: An instrument a testator prepares, or has prepared,
directing how to distribute her property after she dies.
Clarkson et al.’s Business Law: Commercial Law for Accountants (1E)
TESTAMENTARY GIFTS
Devise: A gift of real property.
(e.g., I leave the rest of my estate for the enjoyment and
support of my beloved dachshund, Frank).
Abatement: If the estate’s assets are insufficient to pay all
bequests in full, each bequest is reduced proportionally –
when the devise or bequest becomes payable.
Disclaimer: A beneficiary can renounce her share of the
property under a will.
WILLS: REQUISITES FOR VALIDITY
Testamentary Capacity: The testator must be of legal age
and sound mind at the time he makes the will. Generally, a
Writing Requirement: Generally, a will must be written.
Holographic Will: A will that is completely
handwritten.
wills, must be declared before and signed by witnesses.
Ch. 31: Wills and Trusts – No. 4
Clarkson et al.’s Business Law: Commercial Law for Accountants (1E)
WILLS: REVOCATION
another to do so in the testator’s presence;
(2) Subsequent Writing: intentionally making a new will,
or by amending or revoking any or all of a will by means
of a codicil; or
(3) Operation of Law: due to marriage, divorce, or
Ch. 31: Wills and Trusts – No. 5
Clarkson et al.’s Business Law: Commercial Law for Accountants (1E)
PROBATE PROCESS
Probate: The legal process required to establish the validity
of a will and to administer the decedent’s estate.
among themselves, subject to court approval, how
the assets will be distributed.
Formal Probate: For larger estates and for smaller
estates that require the appointment of a guardian to
assets that designate a beneficiary (e.g., inter vivos
trusts, life insurance policy proceeds, IRAs, joint
checking accounts with rights of survivorship) pass to
the designated beneficiary without going through the
probate process.
Ch. 31: Wills and Trusts – No. 6
Clarkson et al.’s Business Law: Commercial Law for Accountants (1E)
INTESTACY
When a person dies without leaving a valid will, he is said to
have died intestate. In such cases, the deceased’s property
passes according to law, rather than according to his wishes.
Generally speaking, an intestate’s property passes first to
mother.
When the intestate has no surviving spouse, her property
will typically pass to her surviving children, if any, and
grandchildren, if any, either
are no surviving children, each grandchild – will
take an equal share).
Clarkson et al.’s Business Law: Commercial Law for Accountants (1E)
TESTAMENTARY GIFTS
Devise: A gift of real property.
(e.g., I leave the rest of my estate for the enjoyment and
support of my beloved dachshund, Frank).
Abatement: If the estate’s assets are insufficient to pay all
bequests in full, each bequest is reduced proportionally –
when the devise or bequest becomes payable.
Disclaimer: A beneficiary can renounce her share of the
property under a will.
WILLS: REQUISITES FOR VALIDITY
Testamentary Capacity: The testator must be of legal age
and sound mind at the time he makes the will. Generally, a
Writing Requirement: Generally, a will must be written.
Holographic Will: A will that is completely
handwritten.
wills, must be declared before and signed by witnesses.
Ch. 31: Wills and Trusts – No. 4
Clarkson et al.’s Business Law: Commercial Law for Accountants (1E)
WILLS: REVOCATION
another to do so in the testator’s presence;
(2) Subsequent Writing: intentionally making a new will,
or by amending or revoking any or all of a will by means
of a codicil; or
(3) Operation of Law: due to marriage, divorce, or
Ch. 31: Wills and Trusts – No. 5
Clarkson et al.’s Business Law: Commercial Law for Accountants (1E)
PROBATE PROCESS
Probate: The legal process required to establish the validity
of a will and to administer the decedent’s estate.
among themselves, subject to court approval, how
the assets will be distributed.
Formal Probate: For larger estates and for smaller
estates that require the appointment of a guardian to
assets that designate a beneficiary (e.g., inter vivos
trusts, life insurance policy proceeds, IRAs, joint
checking accounts with rights of survivorship) pass to
the designated beneficiary without going through the
probate process.
Ch. 31: Wills and Trusts – No. 6
Clarkson et al.’s Business Law: Commercial Law for Accountants (1E)
INTESTACY
When a person dies without leaving a valid will, he is said to
have died intestate. In such cases, the deceased’s property
passes according to law, rather than according to his wishes.
Generally speaking, an intestate’s property passes first to
mother.
When the intestate has no surviving spouse, her property
will typically pass to her surviving children, if any, and
grandchildren, if any, either
are no surviving children, each grandchild – will
take an equal share).