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The ins and outs of conditional gifts

  • By:Neil Lyons

Have you been the recipient of a conditional gift? Or, perhaps, you’ve considered distributing a conditional gift but aren’t sure what is involved.

Here are some important things to know about conditional gifts.

Conditional gifts can be confusing

A conditional gift usually requires the occurrence of an event before the gift is distributed.

It can be difficult to determine whether a condition has been met. A very common condition of a gift is a requirement that a beneficiary reaches a certain age before the gift is distributed. This is a requirement that is easily determinable.

On the other hand, requiring a beneficiary to be “financially responsible” without any further specifics can cause unnecessary confusion. This confusion can contribute to needless expenses in attorney fees and court costs. Additionally, a court is likely to interpret a testator’s inclusion of a conditional gift in a will as an intent to create a trust for a beneficiary.

What options are available?

First, people looking to draft any will, much less a will with a conditional gift, should be working with a licensed attorney.

Second, people looking to leave a conditional gift in their will should consider executing a trust. A trust enables someone to create a conditional gift that can be managed by a third party of their choice.

This individual is the trustee. A trustee has the authority to take possession of the gift, manage it while it is in the trustee’s possession and distribute it when the condition is met.

A trust is a more efficient way to ensure your conditional gift is distributed in accordance with your wishes and desires. 

Attorney Neil T. Lyons pursued a career in law for the sole purpose of helping people. His practice focuses on the area of elder law, including estate planning, trust and probate administration and guardianship. His early legal experience solidified his commitment to assisting, whenever possible, two very vulnerable groups: children and the elderly. He receives repeated recognition by various organizations for his pro bono efforts in Manatee and Sarasota counties. Neil also consistently engages in service to the legal community and joined the Luhrsen Goldberg staff in 2019.

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