No, per stirpes itself is a method of distributing assets, not a direct mechanism for avoiding probate for an entire estate. However, it can simplify the transfer of an inheritance to a deceased beneficiary's heirs, potentially preventing the need for a separate probate process for that specific inherited share.
Understanding Per Stirpes
Per stirpes, a Latin term meaning "by branch" or "by roots," is a common distribution method used in estate planning documents like wills and trusts. It ensures that if a designated beneficiary predeceases the person making the will or trust (the grantor), that beneficiary's share of the inheritance passes down to their lineal descendants (children, grandchildren, etc.) in equal shares.
How Per Stirpes Works
When per stirpes is specified, the inheritance is divided at the generation closest to the grantor where there is at least one living beneficiary. If a beneficiary in that generation has died but has living descendants, their share is then passed down to those descendants.
Example:
Imagine a grantor with three children: Alice, Bob, and Carol.
- Scenario 1: All children are alive. Each child receives one-third of the estate.
- Scenario 2: Alice has died but has two children (David & Emma). Bob and Carol each receive one-third. Alice's one-third share is then divided equally between David and Emma, so they each receive one-sixth of the total estate.
This contrasts with per capita at each generation, where shares are divided equally among all living beneficiaries at the closest generation, and then any remaining shares are pooled and divided among the next generation's living beneficiaries.
Per Stirpes and Probate Avoidance
The role of per stirpes in probate depends heavily on the type of estate planning instrument it's included in:
1. In a Last Will and Testament
If per stirpes is included in a will, the will itself will still need to go through probate. Probate is the legal process of validating a will and distributing assets according to its terms, supervised by a court.
However, the benefit of per stirpes in a will arises when a named beneficiary has died. In such cases, per stirpes allows the deceased beneficiary's share to flow directly to their descendants as specified in the will, potentially without requiring a separate probate process for the deceased beneficiary's own estate to claim that inherited asset. This can save the deceased beneficiary's heirs from additional "hassle, time, stress and expense of probate" for that specific inheritance.
2. In a Living Trust
If per stirpes is included in a living trust, the entire trust can avoid probate. Assets held within a properly funded trust are generally not subject to the probate process upon the grantor's death. The per stirpes provision within the trust simply guides the trustee on how to distribute the trust assets if a beneficiary has died, ensuring the inheritance passes down through the family lines as intended, all outside of court supervision.
Summary Table: Per Stirpes and Probate Interaction
Estate Planning Instrument | Does the Instrument Go Through Probate? | How Per Stirpes Affects Probate |
---|---|---|
Last Will and Testament | Yes | Helps avoid secondary probate for a deceased beneficiary's inherited share, allowing it to pass directly to their descendants. |
Living Trust | No | Guides the trustee on how to distribute assets within the non-probate trust if a beneficiary has died. |
Practical Benefits of Using Per Stirpes
Incorporating per stirpes into your estate plan offers several advantages:
- Ensures Lineal Distribution: Guarantees that your inheritance remains within your family's bloodline, even if a direct heir is no longer living.
- Avoids Unintended Distribution: Prevents assets from being distributed according to state intestacy laws (which might not align with your wishes) if a beneficiary dies without a will.
- Streamlines Process: As noted, it can simplify the transfer of assets to the next generation in the event of a beneficiary's death, potentially avoiding extra legal steps and costs for that specific inheritance.
- Clarity for Heirs: Provides clear instructions for asset distribution, reducing potential disputes among beneficiaries.
While per stirpes itself is not a probate-avoidance tool for the entire estate, it's a critical component of a comprehensive estate plan, especially when combined with a living trust, to ensure your wishes are carried out efficiently and to minimize probate complications for your beneficiaries' inheritances.