What should be considered when excluding a child in your estate plan?

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What should be considered when excluding a child in your estate plan?

By Attorney Truman Scarborough

Except for certain rights minor children have in the home, Florida Law does not require that any part of your estate go to your children. This is not the case with the spouse. As a minimum, a surviving spouse has a right to the following from the deceased spouse’s estate: a life estate or fifty percent interest in the home; $20,000 in furniture, appliances, and furnishings; two vehicles; and 30% of all other property regardless of how it is titled. 

Excluding a child is a serious decision. There can be a variety of reasons for excluding a child or giving the child smaller share. These reasons include: 1] a child may be estranged from the parents; 2] a child may not need money; 3] a child may have already received substantial sums from the parents; or 4] other children may have sacrificed much more for the aging parents. On the other hand, if a child has creditor, marital, or substance abuse problems, a parent need not exclude the child, but can place the child’s share in a special trust for the child’s protection.

Once a decision is made to disinherit a child, care must be taken on how it is handled in the will or trust. You could simply not mention the child. However, if you don’t state that the child is excluded, a court could be persuaded that the failure to mention the child was an oversight or drafting error and rule that the child receives an amount equal to the other children.

This rases the question when stating that a child is excluded, should you provide reasons? When a reason is given, the child could challenge the will / trust, alleging that the reason given is not factually correct. The courts have the power to overturn wills / trusts based on mistaken facts. In our documents we state that the child is excluded for reasons they will understand without giving a particular reason.

Even when there are  good reasons, being disinherited can be painful. More than the money, there can be a feeling of rejection that could grow into resentment and anger against the other children as well as the parents. If the reason is not stated in the Will / Trust should the parents while still living explain the reasons to the child? This can create problems for the parents.

Contrary to popular thought, you are not required to leave the disinherited child anything. Some people mistakenly believe that you must give the disinherited child some small amount, say $10. This can create a problem. The child will find the gift insulting and refuse  the gift. When there is $10 remaining in the estate account, it is difficult to close the estate.

Rather than completely disinheriting the child, he/she may be left a smaller share than the other children. Some people want to include a provision that if the child challenges the will or trust, he/she loses everything he/she was to receive. This is called a “terrorem clause” because it is intended to terrorize the person not to challenge the will / trust.  Both the Florida Probate Code and the Florida Trust Code state that these terrorem clauses are not enforceable in Florida, so we do not include them in our documents.

For further information you may be interested in Attorney Truman Scarborough’s Booklet on Estate Planning in Florida. It is available without charge or obligation by calling (321) 267-4770. Truman Scarborough’s office is located at 239 Harrison Street, in Titusville.