A will can be changed after death with beneficiary agreement, known as a deed of variation or interest disclaimer. It can be used to adjust terms that harm survivors or create financial problems. A will variation must be filed within two years of death and is permanent. It can be used to redirect money to another beneficiary or address perceived injustice. It is closely scrutinized to prevent fraud. Meeting with a solicitor and discussing planned bequests with recipients can reduce the risk of accidental harm.
A will change the terms of a will after death with the agreement of the beneficiaries. It is alternatively termed a deed of variation or an interest disclaimer, depending on the jurisdiction. This tool can be used when the terms of a will would harm survivors in any way and they wish to contest it to adjust the terms. Wills may not consider the impact of bequests on taxes, benefits and other financial matters and may inadvertently create a problem for the beneficiaries. They can choose to challenge the will, and a judge can agree if difficulties are shown and everyone affected by the change agrees.
Laws vary, but typically people must file a will variation within two years of the death. They explain the change they want to the terms, and the judge reviews the situation to determine if the change is warranted. Once approved, the testamentary change is permanent; someone cannot, for example, give up an inheritance and then take it back later. For legal purposes, the situation is treated almost as if the beneficiary had died and directed a bequest to someone else.
People may need to apply for a will variation if a bequest creates a high tax burden or if any inheritance would be claimed by creditors. It can also be a problem for people on benefits who are limited on resources; a disabled beneficiary, for example, could lose assistance by accepting an inheritance. In these situations, a will variation may be made to redirect the money to another beneficiary who is in a better position to handle it appropriately. Similarly, an injustice perceived as one beneficiary getting everything while another gets nothing could be addressed in this way.
As this tactic can be used for measures such as avoiding estate taxes, it is closely scrutinized by government representatives. They want to make sure that variations are being used appropriately and that no fraud is involved. Someone cannot, for example, file a variation to redirect a bequest for a child and then turn around and ask for the money back once the variation has been approved. This would mean that someone actually wants to exploit the legacy without paying any of the associated costs.
When preparing wills and trusts, it can be helpful to meet with a solicitor to discuss planned bequests. This can help people determine how to route bequests more effectively, to reduce the risk that an inheritance could accidentally harm the recipient. It is also advisable to discuss planned bequests with their recipients to learn about any special circumstances that may need to be considered; a grandchild might be preparing to apply to college, for example, and might not want a large bequest that could impact a financial aid award.
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