Tangible Property Myths
“But Grandma said I was to have her diamond ring!”
Since before Jacob tricked Esau out of his birthright and his father Isaac’s blessing, families have argued, fought, and become embittered over inheritances. Some of the most bitter disputes are over things – cars, silver, guns, china, clocks, and in one case I know of – a ceramic cookie jar. Why do possessions create such misery?
Grandpa’s gun collection and Grandma’s china trigger a myriad of memories and emotions. The chipped china bowl that Grandma used to serve you homemade chicken soup in when you were sick is esteemed well beyond its 5 cent value. The .22 that Grandpa taught you to shoot with has more sentiment attached to it than its market value could ever match. But when these things are put up for auction they may be considered as just “stuff” or “junk.”
The best gift you can give your loved ones is to work out these issues of “who gets what” while you are alive and well. Giving this matter thought shows your love and caring – to make sure that your family stays a family.
Yes, I know. You’re thinking to yourself, “my children won’t fight like that.” Keep in mind that the parents of most of the children in those situations where terrible feuds have developed all thought the same thing. These are the same children who can’t agree on what to watch on TV and who can recite, in detail, the things that their siblings were allowed to do that they weren’t. Some things never change.
Let’s say you’ve accepted the responsibility and are prepared to deal with the issue of who gets what tangible personal property. Personal property means property other than real estate. Tangible personal property means property you can touch, pick up and carry. A car is tangible, household furnishings and collections are tangible. A bank account is not tangible, although it is personal property.
Often I suggest that clients write a letter or memorandum to place with the will detailing who should get tangible personal property. Again, this is not legally binding but most families will respect wishes expressed in this way.
Myths about how to handle tangible personal property abound. Here are a few:
- If you mention it in the will it gets taxed. Wrong. If you own it when you die, it is part of your estate and subject to inheritance tax. It makes no difference whether it is mentioned in the will or not. The only thing not mentioning it in the will does is make it easier to get away with lying and saying Grandma didn’t have any silver. If that’s what you have in mind, don’t. It’s tax fraud. Often it is the best course to specifically mention important pieces of tangible personal property in the will. Who gets the grand piano and who gets the 1957 Chevy should be spelled out.
- Grandma put tags on everything showing who should receive each item. This is not legally binding. If everyone involved agrees to go along, it may work; but there is absolutely no way of legally enforcing Grandmas wishes when they are expressed this way. Besides, tags can be moved. Tune in next week to hear the conclusion.