Paul Rabalais' Louisiana Succession Law Blog

Is Louisiana Succession Really Necessary When Deceased Left a Clear Last Will?

 

We work with some great families getting estates settled after the death of a loved one. Occasionally we are asked, "Is a Succession really necessary if someone dies with a Will and they are clear about who the heirs are?" Sometimes they ask, "Can't we just take my Dad's Will and a death certificate to the bank and ask the bank to give us Dad's money?"

Well it does not work like that. A Succession is necessary even though the deceased left a Will when there are assets titled in the name of the deceased. The Will is filed at the courthouse along with a number of customized Succession documents including the detailed list of assets and debts, petitions, and a Judgment.

If the judge's office determines that all of the procedural rules have been followed, the judge will sign a Judgment of Possession which orders banks and others to transfer assets from the name of the deceased to the heirs named in the Will and in the Judgment of Possession.

We work with phenomenal families from all 64 Louisiana parishes in order to get estates settled. The fact that we embrace technology in our office allows us to get this done in lickety split, keeping suriviving heirs from suffering through delays and other stresses.

How I Saved a Family $1,200,000

I had a meeting with a nice family last week. Dad had died during this year and they were wanting me to settle Dad's estate. Dad had an estate of about $2,500,000 and Mom had an estate worth about $1,000,000. Dad had quite a bit of separate property that he had inherited.

Dad's Will left his entire estate to Mom. I'm confident that most lawyers would have followed the Will and put all of the assets into Mom's name during the Louisiana Succession, knowing that there is no federal estate tax for deaths occurring in 2010.

A light came on in my head during my meeting with Mom and the kids. It appeared to me that there would be significant estate tax when Mom dies in 2011 or beyond when the estate tax exemption is scheduled to be $1,000,000. If Mom dies with an estate of $3,500,000, then under the law as it now stands for deaths in 2011 and beyond, there will be $1,200,000 in estate tax when Mom dies.

I told the family, "Perhaps Mom should disclaim her inheritance from Dad and let Dad's estate pass down to the children." Under this scenario, the children will receive Dad's $2,500,000 estate free of estate tax (since Dad died in 2010 when we have no estate tax - apparently), and Mom will be left with an estate of $1,000,000. When Mom dies in 2011 or beyond, Mom's estate tax exemption will shield her estate from tax.

Most Louisiana general practice lawyers would not have utilized this estate tax savings approach. Heck, most Louisiana general practice lawyers have no idea this kind of stuff exists! At best, they would have lumped it all in her estate and then maybe advised some $13,000 gifting - which wouldn't put a dent in the potential estate tax bill since Mom is not in the best of health.

I realize that Congress could change the laws tomorrow but I believe this planning technique will save this family over $1,000,000

Paul Rabalais

One Child Inherits the Spouse After Both Parents Die - How To Do It

I've been working on a succession the last several weeks of a surviving spouse. Mom died a few weeks ago. Dad died back in 2002. Dad left the usufruct of his estate to Mom, and named their three children as naked owners.

Now that Mom has died, the three children would like one of the children to inherit the house as part of his inheritance from Mom and Dad. Can they do this?

One of the issues that will need to be addressed is that the three children inherited Dad's one-half of the house back in 2002, subject to Mom's usufruct. Now that Mom has died, the three children co-own one-half of the house (or I guess you could say that each child owns 1/6 of the house).

In order for the one child to fully own the house after Mom dies, not only do we have to structure the Judgment of Possession in Mom's succession to reflect that the one child is inheriting Mom's half of the house, but the other two children will have to transfer (sale or donation) their 1/6 interest in the house to the other child so that one child can own the house in full ownership.

The point is that after the surviving spouse dies, we often need to refer back to the succession of the first spouse to die when dividing family assets among the heirs.

If you are an executor of an estate and would like to discuss how we can efficiently provide our legal services to guide you through the settlement of a Louisiana succession of a deceased loved one, give us a call at 225-329-2450, or send me an email at paul@rabalaislaw.com

Paul Rabalais

Who Inherits In Louisiana If Your Heir Dies Before You - PART II

What if you leave a bequest to a sibling or a child, and that person dies before you, and that person had no descendants? Who gets that bequest.

For example, let's say your Will provides, "I leave $50,000 to my brother Fred, and I leave the balance of my estate to my two children, Jack and Jill."

Fred dies before you and he is survived by no descendants. The bequest of $50,000 is known in Louisiana succession law as a "particular legacy." When this occurs, accretion takes place in favor of the successor who, under the Will, would have received the bequest if the bequest had not been made. So, the $50,000 would go to Jack and Jill, along with the rest of your estate.

Until next time...

Paul Rabalais

Who Inherits in Louisiana If Your Heir Dies Before You - PART I

In 1997, Louisiana laws changed as it relates to who inherits if a legacy lapses. A legacy lapses when the heir (or known in Louisiana law as "legatee") predeceases the person who wrote the Will (known as "testator").

If the heir is a child or sibling of the testator, or a descendant of a child or sibling of a testator, and the heir predeceases the testator, then the heir's portion goes to the heir's descendants who were in existence at the time of the testator's death.

For example, let's say your Will provides, "I leave $50,000 to my brother, Fred." If Fred dies before you, then upon your death, Fred's children will receive the $50,000.

You could take it a step further in your Will if you would not want this bequest to go to Fred's children by stating, "If Fred predeceases me, I leave this bequest to Fred's alma mater, Louisiana State University."

There are several other rules regarding lapsed legacies in a Louisiana succession. I'll be covering those in future posts. If you have questions about how a lapsed legacy should be handled, send me an email at paul@rabalaislaw.com, or post a comment so everyone can benefit from your question. Until next time...

Paul Rabalais