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| THE FOUR NIGHTMARE WORDS OF ESTATE PLANNING A Florida lady came up to me after a seminar and said, "My husband and I have an estate problem ... and we want to know if you can help us." I nodded my willingness to try. She continued, "We have two sons. And we own hundreds of acres of land that are now in citrus trees; but, which are rapidly becoming prime residential land. Recognizing the rapid appreciation of the land and knowing that each of us could give away our $600,000 exemption from estate taxation during life, we decided to give each son $600,000 worth of citrus groves ... with the understanding that ... their future wives would sign a release stating that the gift was not part of the marital estate." "But," she continued, "the sons are now married ... and one of the wives will not sign the release." Then she asked, "Is there anything we can do to force her to sign the release?" Of course, I had bad news for the lady. There is no way that you can force anyone to sign a document that they do not want to sign. It turns out that the daughter-in-law had, quite properly, consulted with her attorney before making a decision. The attorney had, again quite properly, advised her not to sign away any of her rights. So, the land-owning parents had made the "four nightmare words" mistake in planning their estate. They had assumed that the words, "with the understanding that" would carry some weight. They did not. Do not assume anything in your estate. Consult with an estate planning attorney and create iron-clad documents that do not depend on other people complying with you wishes. In this case, the couple should have created a trust for the sons, should have placed the assets into that trust and should have used the three secret words of estate planning, "only my issue." |
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