Splitting heirs: Do's and don'ts of estate planning

Planning ahead for the distribution of your estate will ensure your wishes are followed, and help keep your loved ones out of court -- and away from each other's throats -- after you die.

By Katherine Vogt, AMNews staff. Sept. 15, 2003.

Your prized porcelain figurine could become a divisive force in your family, pitting siblings against each other, if you don't have a will.

And if the language in your will is vague, the $49 statuette could become the center of expensive litigation costing your heirs thousands of dollars as they battle for its ownership after your death.

"Some of the biggest fights I've seen in my practice were over knickknacks and china cabinets," said Les Kotzer, a wills and estate attorney in Toronto. "It sounds petty, but these things destroy a family."

Experts say basic estate planning can help avert major family feuds that erupt over even the slightest ambiguity about the wishes of a deceased relative. Whether it's choosing how to distribute assets among heirs, designating an executor of the will or bequeathing wealth to charity, the decision must be weighed carefully and properly documented, they say, or it can cause long-lasting rifts.

Without a will or other beneficiary arrangement, assets end up in probate court and are distributed to surviving relatives through a state formula and legal proceedings that identify heirs and value property. Though the process can pass assets to heirs, estate planners often recommend that clients with larger estates, like those of many doctors, use a will or a trust to distribute their wealth in a more precise, faster and perhaps tax-advantaged way that also may protect their assets from creditors.

"Generally, physicians' estates are larger, and that brings added planning needs. And they are more exposed than most people to lawsuits, so then the size of their estate and extra exposure makes them more in need of asset protection than most people," said Mike Janko, executive director of the National Assn. of Financial & Estate Planning.