Legal Tip 129: Gifts in a will and Residue – someone missing out

Discussion in 'Legal Issues' started by Terry_w, 5th May, 2016.

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  1. Terry_w

    Terry_w Structuring Lawyer and Finance Broker - all states Business Member

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    Gifts in a will and Residue – someone missing out

    When someone is left the ‘residue’ of an estate they could have their gift reduced or miss out completely if nothing is left.

    Example NSW law
    Dad leaves $20,000 to his son and the residue of his estate to his daughter. He has $40,000 in assets when he does his will so he thinks that fair as they should get 50/50.

    Dad soon after dies and the funeral costs $10,000. Who will miss out?

    Dad’s funeral must be paid first, so his cash left over is now $30,000. But because he gave a specific gift this will reduce the residue of the estate.
    Son will get $20,000
    Daughter will get $10,000
     
    Terry_w, 5th May, 2016
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  2. larrylarry

    larrylarry Well-Known Member

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    In this scenario, I doubt a family provision would be worthwhile but it only goes to show that the testator should think through properly before a Will is drafted. If the residue of the estate was left to both kids, each will get $15,000.
     
    larrylarry, 5th May, 2016
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