Inheritance unveiled: How to avoid family misunderstandings after a loved one's death

In the hit mystery film "Knives Out," there's a pivotal scene where the family of the deceased novelist Harlan Thrombey gathers in the family home to hear his last will and testament.

They all anticipated receiving something substantial, but to their astonishment, Harlan chose to disinherit his family members, leaving his money and property to his nurse, Marta.

If you've seen the film, then you're familiar with the ruckus that ensued, as Harlan's children were left in disbelief over inheriting nothing.

This scenario in the movie mirrors the real-world complexity of inheritance, a topic fraught with emotion often leading to family disputes.

In addition to managing the grief that comes from losing a loved one, there are legal matters that need to be attended to after a death in the family. To assist you in navigating this challenging terrain, we've consulted with Atty. Kris Quimpo of GSE Law for a general overview of the key points you need to be aware of.

Please note that the information provided in this article only offers a broad overview. If you have specific concerns about inheritance, it's advisable to seek guidance from a lawyer.

What possible problems may arise concerning inheritance and estate after death?

1. Division of shares. According to Quimpo, the shares each heir will receive often cause disputes, especially when the heirs are not on good terms with each other.

“Remember that there are different rules on computing legitimes depending on who the compulsory heirs are,” she says.

A legitime is a reserved part of the deceased’s estate meant for the compulsory heirs (spouse and children).

“If the decedent has no spouse but has children and living parents, or if the decedent does not have a spouse or children but have siblings, some of whom have died but left children of their own, the computation of shares are different,” she adds.

A lawyer can walk you through this process of computing legitimes, making sure the estate is duly divided.

2. The composition of the deceased’s estate. Chances are, there may be disputes surrounding what’s included and what should be included in a deceased’s estate. There are instances when a surviving spouse may claim that he or she exclusively owns some of the properties and should not be included in the conjugal estate.

“There are also instances when the decedent, while still alive, transferred properties in the name of one child or a third person only as a form of security without any actual consideration or payment. These people may claim ownership over the property,” explains Quimpo.

3. While still alive, the decedent took out a loan and mortgaged his or her properties. Inheriting a property means inheriting all the paperwork that comes with it. If the deceased filed for a loan and used the property as mortgage, Atty. Quimpo says that it’s the heirs’ responsibility to pay the loan to eliminate the risk of losing the property.

“This is because the heirs also inherit the rights and obligations of the decedent which are not extinguished by death. However, sometimes the heirs do not have the funds to pay the loan and the estate is not liquid,” says the lawyer.

How can you avoid family disputes and misunderstandings concerning inheritance?

As early as now, you can already start planning your estate.

Quimpo suggests preparing for how your assets will be distributed according to your wishes. You can discuss this with your family lawyer so you’ll be informed about the steps you need to take.

“No matter how close a family is, there may still be differences/misunderstandings that can happen during estate settlement especially when the deceased gave instructions or promises to one heir which is not known to the other,” explains Quimpo.

If you already have a last will and testament, you can also update it regularly to avoid misunderstandings.

Quimpo suggests keeping all files related to your assets in one place to make it easier for the heirs to handle estate settlement and list all your obligations.

Taxes shouldn’t be forgotten, too. Estate taxes must be paid within one year from the death of the deceased to avoid penalties.

“You may also take advantage of the estate tax amnesty to settle estates of descendants whose properties have already been transferred to you. It would minimize the burden on your heirs who may end up having to settle several estates before they can distribute the estate,” explains Quimpo.

— LA, GMA Integrated News