Receiving an inheritance can be both an emotional and life-changing experience. Whether you’ve inherited cash, investments, real estate, or retirement accounts, it’s important to make thoughtful decisions before spending or transferring those assets.
If you’ve recently received an inheritance, working with an estate planning attorney in Missouri can help you understand your legal options, avoid common mistakes, and ensure your inheritance supports your long-term financial goals.
Quick Answer
An inheritance can affect your estate plan, taxes, and financial future. Before making major decisions, take time to understand what you’ve inherited and consult experienced legal and financial professionals when appropriate.
Understand What You’ve Inherited
Different types of inherited assets come with different rules and considerations.
Retirement Accounts
Inherited IRAs and other retirement accounts are subject to IRS distribution requirements. Withdrawing funds too quickly—or failing to follow applicable rules—can create unnecessary tax consequences.
Before taking distributions, consult with your financial advisor and estate planning attorney.
Real Estate
Inherited real estate often involves important decisions, including whether to:
- Keep the property
- Sell it
- Rent it
- Share ownership with other heirs
If multiple family members inherit the same property, clear communication and legal guidance can help prevent future disputes.
Business Interests and Other Assets
Family businesses, partnerships, mineral rights, and other unique assets may require additional planning before any ownership changes are made.
Be Careful About Mixing Inherited Assets
In Missouri, inherited assets are generally considered separate property. However, combining inherited funds with joint accounts or jointly owned property can complicate ownership if legal disputes arise later.
If preserving your inheritance as separate property is important, speak with an estate planning attorney in Missouri before making significant financial decisions.
Should You Accept the Inheritance?
In certain situations, accepting an inheritance may not be the best choice.
A qualified disclaimer allows you to refuse all or part of an inheritance so it passes according to the estate plan or applicable law.
This strategy may be appropriate if:
- You want assets to pass to the next generation.
- Accepting the inheritance could create tax consequences.
- You have creditor concerns.
- Government benefit eligibility could be affected.
Because disclaimers must meet strict legal requirements and deadlines, legal guidance is essential.
Review Your Estate Plan
Receiving an inheritance is an excellent time to review your own estate plan.
Consider updating:
- Your will or trust
- Beneficiary designations
- Powers of attorney
- Healthcare directives
- Trust planning for your heirs
Updating your plan helps ensure your newly inherited assets are protected and distributed according to your wishes.
Avoid Rushed Financial Decisions
Many inheritances follow the loss of a loved one, making it an emotional time to make significant financial choices.
Rather than making immediate purchases or major investments, take time to evaluate your options and develop a plan that aligns with your long-term goals.
Work with an Estate Planning Attorney in Missouri
Every inheritance is unique. Whether you’ve inherited investments, retirement accounts, real estate, or other valuable assets, experienced legal guidance can help you protect what you’ve received and incorporate it into your overall estate plan.
At Beck, Lenox & Stolzer Estate Planning and Elder Law, LLC, we help Missouri families navigate inheritances, update estate plans, and preserve wealth for future generations.
If you’ve recently received an inheritance or expect to inherit assets, contact Beck, Lenox & Stolzer Estate Planning and Elder Law, LLC to schedule a consultation.
Reference: Wealth Advisor (Nov. 10, 2020) “Death by inheritance: Windfall can cause complications”