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Stepchildren and inheritance

| Mar 31, 2016 | Estate Planning |

Stepparents may wish for their spouse’s children to inherit money, property or other assets. However, unless there is a will in place that specifically states that intent, stepchildren may not automatically receive them.

It is not uncommon for parents to provide an inheritance for their children. Even though the person making the will has a right to decide who should inherit his or her property, when there are biological children and stepchildren involved, things can become complicated. According to The Stepfamily National Resource Center, stepchildren may not have the same inheritance rights as biological and adopted ones.

When a stepparent dies and doesn’t leave a will behind, even if there are no biological or adopted children, stepchildren still are not allowed to inherit. The state may automatically pass any inheritance that is left behind to the deceased’s spouse and descendants. In the event that there is no spouse or any biological or adopted dependents and grandchildren, then all inheritance automatically will pass to the deceased’s parents, siblings and other biological and adoptive relatives.

Inheritance issues are a common source of conflict in families, especially when there are biological and stepchildren involved. The American Association of Individual Investors recommends for parents to take appropriate action to ensure stepchildren receive their inheritance. This is easily done by establishing and funding trusts by naming beneficiaries. Parents should review and update their estate plans after each major life event, such as divorce and marriage. They should also include the names and assets that each child is to receive.