What is a Residual Clause in a Will?

When you’re creating an estate plan, one of the biggest challenges is actually remembering to include everything that you own so that you can dictate where it goes or to whom it goes to. In everyday life, we may not remember all of the items, assets, or property that we own. In fact, we may own things without even knowing or remembering them.

So what happens when you have assets that you just “forget about” and they end up not being included in your estate plan?

Passing by Intestate

If there are assets that aren’t included in your estate plan, those assets are treated the same way your estate would be treated if you had no estate plan: they will be devised according to Florida’s intestate laws. And that may not be what you want—in fact, it’s probably not what you want, since you already went through the effort of creating an estate plan for all of your other assets.

There is also the matter of any assets that may come into being after you have created your estate plan that didn’t exist when you did.

For example, you may realize a profit on an appreciating asset, or you inherit something from someone else, all after you’ve created your estate plan. Hopefully you would have amended your estate plan to include these things, but if you don’t, they will again be treated as and passed on according to Florida’s intestate statutes.

Using a Residuary Clause

The good news is that you can include what is known as a residuary clause in your will. A residuary clause is a “catch all” provision that essentially leaves anything that you may have left out of the will, to whomever you designate. It also will speed up the probate process, as the court only needs to follow the instructions of your estate plan.

The residuary clause can also include “backup beneficiaries” in the event that someone who was supposed to receive something from your estate plan passes away before you do. It can also dictate where property goes in the event a named beneficiary doesn’t want something you have left to him or her.

The residuary clause is quite simple. It’s just a statement that any remainder of your property, or after-acquired property, will go to whomever you designate. You can leave the residual, left-out property to a person, or an organization, such as a charity.

Vague But Specific

Of course, you don’t know what it is that you left out (otherwise you would have included it), so residuary clauses often have to be vague enough to encompass all possibilities, but specific enough that beneficiaries know who gets what.

Get help with your estate plan. Call the West Palm Beach estate planning lawyers at The Law Offices of Larry E. Bray today for help with your real estate closing.

Sources:

findlaw.com/forms/resources/estate-planning/last-will-and-testament/residuary-estate-in-will.html

finance.yahoo.com/news/write-residuary-estate-clause-140003709.html