I discovered my passion for helping families with their estate matters after my lengthy experience as a former litigator. Because of this experience, I understand how challenging it can be when an estate is delayed by court proceedings or disputes. It places a heavy burden on the family and feels like a weight on the estate executor’s shoulders. One common situation requiring court petitions and hearings is when inheritance passes to minors.
As you can imagine, an estate executor cannot simply hand an inheritance check to a twelve-year-old child. A minor’s inheritance is generally subject to a court process involving the appointment of a guardian. Unless proper planning is in place, the executor will need to file a petition and attend a court hearing to appoint a ‘guardian of the estate’ for the child. The named guardian will be obligated to file annual reports, and the minor’s funds are essentially locked until the minor reaches the age of majority. Minors must attend guardianship hearings, which can be a painful experience.
The primary concern for most parents who come to me for estate planning is the protection of their children. Having a well-structured estate plan in place can help avoid these painful experiences and make the executor’s job easier.
There are various factors to consider when planning a minor’s inheritance. Here are a few key questions to start thinking about: Who would parents trust to serve as the minor’s guardian? Can a guardianship situation be avoided? Perhaps most importantly, how much discretion should the minor or the guardian be given regarding how the money will be managed before majority?
One common planning technique is to take advantage of the Pennsylvania Uniform Transfer to Minor Act (UTMA) which can be found at 20 Pa.C.S.A. § 5301, et seq. The UTMA creates a simply way to manage a minor’s inheritance by appointing a designated “custodian” to manage the funds until the child reaches age 21. Wills that contain this provision can eliminate the need for filing a court petition to appoint a guardian for the minor and the reporting requirements. Another benefit of including a UTMA provision in a Will is flexibility. Funds subject to guardianship are essentially locked until age 21, where UTMA funds can be used for the minor’s health and education.
As a probate attorney to estate executors, I understand the emotional and logistical challenges when dealing with a minor’s inheritance. If you or someone you know has any questions or concerns about updating your Will or passing inheritance to a minor, please forward our contact information below:
Phone: (215) 918-4242
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