Published by Ask General Counsel on InsideNova, 11/12/02021

Image from Inside Nova

Deciding which family members will receive your assets upon death is one of the main considerations in estate planning.

• What happens to that adult child’s share named in the estate plan who predeceased their mother?
• Is the predeceased child’s share divided between the surviving siblings?
• Or, if the deceased sibling was an adult with a child of her own (the testator’s grandchild), is that part of the deceased mother’s estate given to her grandchildren or divided between the surviving siblings?

The easiest way to explain these different concepts, and why they could matter, is to use a real-life example from a well-known family: the Kardashians.  Below we outline what would happen under each survivorship option: “Per Stirpes,” “By Representation,” and “Per Capita.”

Assume for this example that Kris Jenner left her entire estate to her six biological children: Kourtney Kardashian, Kim Kardashian, Khloe Kardashian, Rob Kardashian, Kendall Jenner, and Kylie Jenner — however, for this example, imagine that an unfortunate random freak accident occurred, causing Kourtney and Khloe, both who have children of their own, to pass away before their mother, Kris.

By Representation

For an estate that is distributed to beneficiaries using the By Representation survivorship option, if an adult child (or multiple children) named in a will or a trust has already passed away (“a predeceased beneficiary”), their shares are divided equally between all their children even if one or more die first. In this way each child is “represented” in the estate even if they pass away because the inheritance is distributed to the next generation equally – usually to the testator’s grandchildren (i.e. a deceased adult child’s children).

So, in this example, there are a few “ifs” that we need to assume. If Kris’ will or trust left her estate to her children By Representation, and if Kourtney and Khloe (both moms themselves) predeceased Kris (a grandmother), Kris’ estate would be distributed as follows:

• 1/6 to each of Kris’ surviving four children: Kim, Rob, Kendall and Kylie for a total of 4/6 of Kris’ estate, and then …
• 2/6 would be equally divided among Kris’ grandchildren if their moms had passed away: Kourtney’s three children: Mason, Penelope and Reign, along with Khloe’s one child, True.

Per Stirpes

Now if Kris chose a Per Stirpes survivorship option in her will or trust, the closest familial relationship controls, and that beneficiary will receive an equal share of the deceased’s family member’s assets. So, using the same example as above, where adult children and moms Khloe and Kourtney predecease their mother, Kris’ estate would be distributed as follows:

• 1/6 to each of Kris’ surviving four children: Kim, Rob, Kendall and Kylie for a total of 4/6 of Kris’ estate, and then … 
• Kourtney’s three children (Mason, Penelope and Reign) would each divide Kourtney’s 1/6 share of their grandmother Kris’ estate three ways, and then
• Khloe’s only child, True, would receive Khloe’s entire 1/6 share.

Therefore, comparing the two survivorship options above, per stirpes and by representation, whether the terms are present in a will or a trust, you can see that the difference is essential whether the grandchildren would receive equal shares. In the first example, by representation, the grandchildren inherit the predeceased mom’s shares equally.

By contrast with the per stirpes method, the grandchildren inherit the shares of their predeceased mother, but those shares are split between siblings. However, there is one more choice you can make for your estate planning survivorship option in your will or trust:

Per Capita

“Per Capita” is a Latin term literally meaning “by heads,” or “for each head,” and synonymously meaning “per person.”  In estate planning, the per capita survivorship option in a will or a trust is when an inheritance is divided based on the number of immediate family members who are living at the time of the person’s death (i.e., shared among the number of survivors, or by each head). Applying this per capita rule to the same hypothetical above, where Kourtney and Khloe die before Kris, Kris’ estate would be distributed as follows:

• 1/4 to each of Kris’s surviving children: Kim, Rob, Kendall and Kylie, and then
• Zero to Kris’ surviving grandchildren if Kourtney and Khloe pass away before Kris.

In other words, Kourtney’s children (Mason, Penelope and Reign) and Khloe’s child (True) would not be entitled to any of their respective parents’ shares under the per capita survivorship option if their mothers predeceased their grandmother.

With an understanding of the different survivorship options discussed here, you may realize that your current plan does not do exactly what you thought it did or what you would like it to do. Also, the survivorship options may not appeal to you — you can also select a customized survivorship option with conditions to inherit that are personal to you naming specific family members, loved ones, and/or charities.  Wills and Trusts are not one size fits all.

Also, it may be important to you to make your own choices about the medical care you receive in case of an emergency. In that situation, your estate plan should include an advance healthcare directive, or a living will, as well as a health care power of attorney.

Contact Us

An experienced estate planning attorney can help you prepare and guide you through the process of protecting your wealth and possessions and also provide strategies to leverage your legacy. Estate planning attorneys at General Counsel, P.C. can guarantee that you will feel more confident about your future after you make your estate plan or update your existing plan.

We would welcome the opportunity to help you navigate the estate planning process, as well as discuss inheritance tax planning considerations, and ways to avoid being held up in probate court if you expect to receive an inheritance.

Contact Ann-Marie Murzin today at intake@gcpc.com, (571) 396-8460, or schedule an appointment here, to learn more about how we can help you protect yourself, and your loved ones!