Trying to make sense of your loved one’s will or trust? Don’t feel bad, and don’t feel overwhelmed. The death of a loved one can be a difficult time, both emotionally and financially. Should you find yourself in a fog of confusion with the legal jargon of a will or trust, the team at Webb Law Group, APC is here to help.
If you don’t know what a lot of the legal words or terms in your loved one’s will or trust mean, we’ve outlined a detailed list below to better explain them to you. Use this helpful guide to breeze through the “legalese” only experienced law firms and legal teams are familiar with so you can better understand the documents left by your deceased friend or family member.
Common Terms Found in Wills & Trusts
Beneficiary: Someone named in a legal document to inherit money or other property. Wills, trusts, and insurance policies commonly name beneficiaries. Said beneficiaries may also be named for “payable-on-death” accounts.
Bequeath: Another term for the word “give” or “gift”. To leave the property at one’s death to a person or organization.
Bequest: A gift of an item of personal property (that includes anything and everything besides real estate) made at death. A bequest is a financial term describing the act of giving assets such as stocks, bonds, jewelry, and cash, to individuals or organizations, through the provisions of a will or an estate plan. Bequests can be made to family members, friends, institutions, and/or charities.
Bond: A kind of insurance policy that protects inheritors against loss that the personal representative of an estate (the administrator or executor) might cause.
Custodian: In regard to estate planning and trusts, the custodian of an estate is the person or trust company responsible for managing the money, real estate, and/or other property placed in custodial trust for a minor child. In instances of this nature, the trust becomes part of the child’s personal estate. Any person who sets up a custodial trust for a child can name herself custodian or appoint someone else. The person named to manage property inherited by a minor is governed under a law called the Uniform Transfers to Minors Act, which has been adopted in almost every state.
Devise: A gift of real estate left at death. This is also a term meaning “to give at or in the event of” one’s death.
Devisee: Someone who inherits real estate (real property) through a will.
Executor: The person named in a will, and appointed by the probate court after the will-maker’s death, to wind up the affairs of a deceased person. In some states, executors are referred to as “personal representatives.” The executor of a trust, normally referred to as the trustee, holds legal title to all trust, assets but is expected to administer these assets for the benefit of the beneficiaries rather than him or herself. Some of the executor’s responsibilities are set by state law, and others are set by the terms of the trust.
Gift and estate tax: A tax imposed on very large transfers of property (during life or at death) by the federal government. Some states have their own additional laws on estate taxes and as well.
Grantor: Someone who creates a trust; a settlor. A grantor, or writer, is the seller of either call or put options who collects the premiums for which the options are sold. Options are sold through exchanges to option holders who are responsible for the payment of the premium. The term can also refer to the creator of a trust regardless of whether the grantor also functions as the trustee.
Failed or lapsed gift: A gift made in a will that cannot be given to the intended recipient because that person has not survived the will-maker and the will does not state what should happen to the gift.
Heir: An heir is defined as an individual who is legally entitled to inherit some or all of the estate of another person who dies intestate. This means the deceased person failed to establish a legal last will and testament during his or her lifetime. In such a scenario, the heir receives property according to the laws of the state in which the property is probated. Heirs who inherit property are typically children, descendants, or other close relatives and friends of the decedent. Spouses typically are not legally considered to be heirs, as they are instead entitled to properties via marital or community property laws.
Inheritance tax: A state tax imposed on people who inherit property. Very few states impose inheritance tax, and most exempt close family members from the tax. There is no federal inheritance tax.
Intangible property: Assets that can’t be touched, such as an ownership interest in a corporation. Documents and stock certificates, for example, are evidence of who owns said intangible property.
Issue: Direct descendants, including children, grandchildren, and so on. A spouse, brothers, sisters, parents, and other relatives are not issue.
Legacy: A gift of personal property left at death.
Legatee: Someone who inherits personal property.
Personal property: All kinds of assets except real property.
Personal representative: Another name for the executor or administrator of an estate. Some states use this term (often abbreviated “PR”) instead of executor; some states use either.
Per capita: A way of dividing property among the descendants of a deceased heir beneficiary.
Per stirpes: A Latin term that means “right of representation.”
Real property: Real estate, land, and things permanently attached to it, such as houses.
Residue or residuary estate: All property subject to a will that isn’t given away specifically in the will. Often, a will leaves certain valuable items to named beneficiaries and then “the rest and residue of my estate” to another beneficiary.
Revocable trust: A trust that the settlor can revoke at any time during his or her lifetime.
Right of representation: A way of dividing property among the descendants of a deceased heir or beneficiary. The general idea is that the children of a deceased beneficiary inherit that person’s share. For example, if a father leaves property to his daughter, and at his death the daughter has already died, leaving two grandchildren, the grandchildren would take their mother’s share.
Settlor: A person who creates a trust.
Successor trustee: Someone who takes over as trustee of a trust if the original trustee can no longer serve.
Tangible property: Items that can be touched. This is in contrast to “intangible property.”
Testamentary: Having to do with a will. For example, a trust that is set up in a will is called a testamentary trust. A testamentary trust is a legal arrangement created as specified in a person’s will and is occasioned by the death of that person. It is created to address any estate accumulated during that person’s lifetime or generated as a result of a postmortem lawsuit, such as a settlement in a survival claim, or the proceeds from a life insurance policy.
Testator: Someone who writes and executes (or signs) a will.
Trustee: A person or firm who has the legal authority to hold and administer property or assets for the benefit of a third party over the assets in a trust. A trustee may be appointed for a wide variety of purposes, such as in the case of bankruptcy, for a charity, for a trust fund, or for certain types of retirement plans or pensions. Trustees are placed in positions of trust to make decisions in the beneficiary’s best interests and often have a fiduciary responsibility to the trust beneficiaries.
Are You In Need Of Legal Advice?
If you’re looking for assistance with your will & trust or you need consultation assistance disputing your deceased friend or family member’s will and/or trust, contact the professional team of lawyers at Webb Law Group, APC. Our team of attorneys can answer your questions about wills, trusts, and probate law.
If you feel you may need legal advice about a claim against an executor or trustee, the team at Webb Law Group is here to answer any questions you might have. Webb Law Group, APC is a reputable probate litigation firm with experience in matters involving California probate law.
Having a reputable attorney by your side for matters of this nature will offer you the best possible chance of navigating or avoiding legal battles and lengthy court cases. If you feel that you need legal representation, we are happy to review your legal needs and provide consultation and support where necessary. For questions, or to schedule a consultation, contact Webb Law Group today at 559-431-4888 (Fresno) or 619-399-7700 (San Diego).
