Case Study 4 - The surviving spouse's share.

Description

Sarah and Joe have three children. Joe worries that his wife, Sarah, seemed too eager to honor his father's living will last year when his father had a heart attack. The more he thinks about it, the angrier he becomes. Will she be just as eager to honor his living will if she stands to inherit from him? He decides that he doesn't want her to inherit anything from him or his family at his death, and that everything should go to their children.

Questions

1. Assume that Joe and Sarah own their home as tenants by entirety. If Joe's will leaves the home to their three children, and he dies before Sarah, the children will inherit the home.

___ True

___ False

2. If Joe and Sarah own everything with a right of survivorship, Joe is wasting his time writing a will.

___ True

___ False

Assume Joe's father, Grandpa Dan, has passed away, and Joe has inherited his fortune outright. Joe's estate is now worth about $5 million.

3. If Joe dies before he can write his will, Sarah will inherit:

___ A. All of Joe's property.

___ B. One half of Joe's property.

___ C. One third of Joe's property.

___ D. One fourth of Joe's property.

4. Joe can disinherit Sarah by leaving her $1 under his will.

___ True

___ False

5. The following options can be successful in disinheriting a spouse:

___ A. Writing the spouse out of the will.

___ B. Prenuptial agreement

___ C. Post-nuptial agreement

___ D. Failure of surviving spouse to claim elective share within time allowed.

___ E. All of the above

___ F. Answers B, C, and D.

6. Assume that Sarah convinces Joe of her undying love and devotion. Under his will, Joe can leave Sarah at most:

___ A. All of his property

___ B. One half of Joe's property.

___ C. One third of Joe's property.

___ D. One fourth of Joe's property.

7. If Sarah inherits the maximum amount of property allowed by law under Joe's will, how much will be exempted from federal estate tax at Joe's death, if he dies in the year 2005? (Joe's gross estate is valued at $5 million.)

___ A. $700,000

___ B. $1 million

___ C. $5 million

___ D. None of the above.

8. If Sarah inherits the maximum amount of property allowed by law under Joe's will, she can skip most of the probate process in her state.

___ True

___ False

9. Assume that Sarah inherits the maximum amount of property allowed by law under Joe's will, and by the year 2008, the value of her estate is $10 million. Also assume that Sarah is seriously injured in a car accident in January of 2008. She is diagnosed as being in a persistent vegetative state and could be kept alive by feeding tubes for years. Her living will states that she does not want to be kept alive by extraordinary means or by feeding tubes if she is diagnosed in this condition. In spite of the huge medical costs, her children will have financial motivation to keep her alive for several years.

___ True

___ False

State-specific Answers to Case Study 4 Questions

Idaho

Iowa

Kentucky

North Dakota

South Dakota

Related Advance Directives Case Studies

Advance Directives Case Study 1 - When is it too soon to honor a living will? When does your health care agent have the authority to make your medical decisions? Advance Directives Case Study 6 - How to preserve assets for your grandchildren and prevent your daughter-in-law from inheriting.

See all Advance Directives Case Studies.

View the Communicate Your Advance Directives for Health Care learning lesson.

Credits

Adapted for use in the Legally Secure Your Financial Future: Organize, Communicate, Prepare program.

Content Development by:
Carol A. Schwab, J.D., LL.M.,
Former Professor and Extension Specialist, North Carolina State University.

This document is for non-profit educational purposes only. This document may not be used by a profit-making company or organization. When used by a non-profit organization, appropriate credit must be given to the Cooperative Extension Legally Secure Your Financial Future: Organize, Communicate, Prepare education program. Materials for this program were developed by a team from six land-grant universities. The program is included in the program toolkit of the Cooperative Extension Financial Security in Later Life national initiative. For more information go to: http://www.csrees.usda.gov/fsll.