@Pizzagirl, I agree.
DH will someday inherit a good chunk of money from his mom in a trust fund started by his grandparents. He doesn’t even give it an instant of thought. As far as he’s concerned, he will leave it untouched and let the girls inherit it someday because he really doesn’t need it.
I can certainly understand that. Did they need to involve the attorney, though? Couldn’t they “accept” the money given and then transfer it to needy-sibling after the fact? On second thought, I suppose there are different tax implications based on the sum of money we are talking about and how it’s passed down (what form it is in).
I would imagine there’s also a difference between whether needy-sibling is more needy simply because s/he doesn’t have as well-paying of a job (but is still a hard worker and responsible), or has some special medical needs, or whether needy-sibling is more needy because s/he is wasteful with money and makes poor decisions.
Yes - they needed to involve an attorney. Family partnership, family property, as well as cash. One way or another an attorney was going to be involved to do it legally.
@Nrdsb4 Mainly the loss of control. With our corporate trustees, we usually had a good relationship for a while. They do what you tell them although they don’t have to listen to you. It doesn’t last forever. Through merger the corporation changes and at some point they don’t want to listen to you. In the trust we dissolved, after a second or third merger, they began to trade excessively. With each trade they make money. We were lucky we could dissolve it before too much damage was done. I couldn’t tell you much about an individual trustee. We never had one on a long term.
I think there would be gift tax implications in one sibling giving more to another sibling outside of the will’s provisions.
I know one relative cut one of her sons out of the will for treating her poorly. The son predeceased her and his children are also cut out. (The sins of the father cut out the children). When she dies, the fit is going to hit the shan.
I am pretty sure when you renounce a portion of your inheritance, you never get into gift tax issues because you never have possession of whatever you are renouncing.
But, that is why we have attorneys instead of trying to figure it out ourselves. It gets complicated.
It also becomes clearer and clearer to me why my father really wanted me to stay in law school. He kept telling me how useful it would be to have an attorney in the family even if all I wanted to do was raise children. The relatively inexpensive tuition at our state school would sure have been worth it over the years just dealing with family stuff. As the eldest, I still had to ultimately be in charge and one of our attorneys got in trouble with the state bar and maybe other authorities (for over billing!), so that wasn’t a great situation.
Depends on how much money and state rules.
Although I got way off track, my basic point is that in some families, where the will divides assets equally, the heirs decide to adjust to make things fair.
Onward: seems odd to me. I would expect that share to go to the grandkids, unless there is a provision in the will for a separate direct inheritance to each grandchild.
To me, grandkids are different than kids when looking at an estate. Each grandchild is his or her own person and if the will is being drafted to include them, each should inherit the same amount (again, unless there is some specific issue such as a disability). We have an uneven number of grandkids on one side, ranging from 1 to 5 per family. But each of those 5 has a relationship with the grandparent and should not be treated differently because they have more siblings. Most will still want to go to college, travel, have a wedding or buy a house. I know some parents feel like it is not fair (in their opinion) that one family is “getting” five times the money than the family with one kid, but they also have five times the expenses and brought 5 times the children to the family.
I am also of the opinion that an estate generally should be divided equally, unless one adult child is significantly challenged in some ways or if one of the siblings is so wealthy that the inherited money will be meaningless and the others can really use it. I know several families in which one sibling has pretty much everything they want including more than one home, while the others are working class. If that were the case with my kids, I would talk to the very wealthy one and see if they were OK with us leaving a certain sum to each grandchild (evenly) but dividing the rest of the money unevenly with the bulk going to the children that really need it. Of course, drawing that line would be difficult. How much is enough to say you don’t need the money? Would you resent the siblings that got it all?
Also, what if one sibling needs the money because they have been irresponsible - house poor, mortgaged to the hilt, spouse doesn’t work even when the kids are grown, no savings. Personally, I would not feel the need to give that kid more than the one that is more comfortable because both parents have worked, have a smaller home, or otherwise lived within their means.
It’s hard to know what’s best to do since none of us can see into the future. The wealth we thought one person had can vanish in a stock crash or a divorce or something unforeseen.
I have one friend who thought she would be set for life. Her husband was to come into a big inheritance, big. But…he died before coming into the big inheritance. The wil of the wealthy ancestorl completely left her out (she was the D-I-L) and eventhough it was a long term marriage, daughters in law and sons in law are usually left out. So when the wealthy ancestor died, the wealth went to her children and she is left scrimping by on SS and her savings.
Dumb Q.
I know the gift tax enables us to give $14k to each kid a year (so H and I could give $28k a year without triggering gift tax).
Hypothetically speaking, what prevents me from rounding up, say, 10 of my neighbors, giving them $14k apiece and then having each of them give that to my kid? How would the govt know? Not doing this 
but just curious what prevents someone from doing this.
Please consult your attorney or your accountant:
But I believe you can gift your children equal amounts, over that $14k annually, up to a a lifetime or estate cap of several millions without triggering a gift tax.
It seems wisest to leave things equally or have them be as flexible as possible considering that many things could change before you die. Even if you have a terminal diagnosis, things could drastically change for your heirs 10 years later. Of course you can’t control everything, but you should try to anticipate any possible scenarios.
The NY Times article keeps repeating the value of having open conversations about these issues and that is the best idea. So much of it seems taboo or just tricky.
Also, if you have a very large estate, things need to be wrapped up really tightly. I remember reading about some large family trust that gave a certain percentage to “future grandchildren” and it caused some spouses of deceased heirs to have in vitro pregnancies with long ago frozen embryos. Yikes. Imagine being born for that reason.
bad link
PG: Ask your accountant. I think you can do it.
The children should make sure that their mother has her needs met.
Re: https://www.irs.com/articles/7-things-you-should-know-about-gift-tax
This site seems to have a poor reputation on Web Of Trust:
https://www.mywot.com/en/scorecard/irs.com?utm_source=addon&utm_content=rw-viewsc
The actual IRS web site (note irs.gov) has articles like these on gift tax:
https://www.irs.gov/filing/estate-gift-taxes
https://www.irs.gov/businesses/small-businesses-self-employed/estate-and-gift-taxes
@pizzagirl – Look up the “sham transaction doctrine.”
Our trust is set up such that our daughters will have the power at any time to replace the trustee with one of their own choosing if they are dissatisfied with performance. At a certain age, they become co-trustees, and at a certain age, they become the sole trustee.
@Pizzagirl - that would be a fraudulent transaction. I suppose there is some chance you could get away with it though.
Regardless, there’s no need to bother with such a scheme. Under current law, a married couple can give away up to $10,900,000 (total) without gift tax. So if you have two kids you could give over $5 million to each kid without gift tax. They wouldn’t have to pay income tax on the gifts either. Simpler than rounding up friends for 400 sham transactions.
If this isn’t enough for you, you can probably afford to ask a lawyer for more advice 
^Just what I was going to say to PG.
@Nrdsb4 Ours did, too. Wrong things can happen before they reach that age. Hope that’s not the case for you.