Today, blended families have become increasingly common, and many individuals have stepchildren. In situations where stepchildren have not been legally adopted, however, they do not have a legal right to an inheritance from a stepparent. For those who wish to leave stepchildren part of their estate, it is necessary to include them in an estate plan.
There are a number of estate planning tools that can be utilized to include stepchildren in an inheritance. The easiest way to leave gifts to stepchildren may be to name them in a Will. As with any other gift, they can be given a percentage of the estate, or specific gifts. If there are other children involved, it is important to avoid confusion by naming each child and stepchild by using their individual names, rather than terms such as “descendants,” “heirs,” or “children.” A stepchild can also be named as a beneficiary in a life insurance policy or a pay-on-death financial account.
If the objective is to avoid probate, for example, a Revocable Living Trust can be established in which a stepchild is named as a beneficiary. If your stepchild is disabled and eligible for public benefits, it may be necessary to provide for them by establishing a Special Needs Trust.
While there is no legal obligation to leave stepchildren an inheritance, it may be the best choice for those who have a close relationship, or played a significant role, in raising them. However, this will reduce the amount of assets available to other children and beneficiaries. Because blended family relationships are complex and subject to emotional challenges, it is important to explain these decisions to all family members. By engaging in an open and honest dialogue, you can minimize the potential for strife and the possibility of a Will contest. It may be important to clarify why you gave each recipient a gift, the selection of your executor, and your thoughts about the family.
It is always a good idea to engage the services of an estate planning attorney who can help ensure your wishes regarding stepchildren are carried out.