People who choose to establish estate plans get to control the legacy they leave when they die. They can select beneficiaries to inherit their property and can designate specific resources for each beneficiary to receive.
Frequently, testators putting together estate plans focus on their progeny, often their children in particular. However, many people have invested heavily in their children’s upbringing already. They may have helped their children pay for college, may have covered wedding expenses and may even have helped them afford a down payment to buy a home.
After providing support for years or even decades, older parents may want to share some of their generosity and success with the next generation. They may want to leave assets for their grandchildren. The three concerns below are all important considerations for grandparents hoping to provide support for their grandchildren.
The age of the grandchildren
Minor children generally do not have direct control over any property that they inherit. Instead, their parents manage resources on their behalf. Grandparents trying to leave some of their property for their grandchildren may need to consider the possibility that parents might squander some of the grandchild’s inheritance. In some cases, grandparents choose to establish trusts as a way of preserving resources for their grandchildren until they turn 18 or even older and have control over what they do with those resources.
The possibility of taxes
Kentucky does not collect an estate tax, but the state does levy an inheritance tax. The relationship between beneficiaries and the testator influences whether taxes apply or not. If a testator wants to leave property for their grandchildren, they can do so without any inheritance tax issues. If they want to leave assets for their great-grandchildren, then inheritance taxes might apply.
The impact on relationships
People usually have the right to choose what to do with their property. However, their family members may have already established a sense of entitlement. Grandparents have to consider the possibility that their children may resent what they leave for their grandchildren. They may find themselves dealing with a strained relationship with their children in their golden years if they disclose their testamentary intentions. Keeping them hidden isn’t necessarily a better solution, as children may lash out at the grandchildren who inherit or might even try contesting a will in probate court.
Grandparents often need to approach the matter of estate planning carefully and give their adult children time to come to terms with their decisions. Integrating the right details into an estate plan can help people establish a meaningful legacy. Most grandparents can leave assets for their grandchildren if they plan appropriately.