Gifts or Loans to Children and Your Estate Plan

Many parents want to help their children through tough spots, it is common to see parents loan or gift amounts of money to their children.  Unfortunately, this can cause disputes and conflicts with the other siblings if the gifts or loans were not addressed in the parent’s estate plans or if their are misunderstandings of the intent.

Elderlawansers.com has an article on this topic which you can read here.

As a Michigan wills and trusts attorney, I agree with the heart of the article, which is that the estate plan should make clear the parent’s intent regarding the gifts or loans.  For example, language outlining that a gift to one of the children does not reduce that child’s overall share.

The key is that the documents must be clear and provide guidance as to whether the transaction was a gift or loan and whether it should be considered an advancement or not.

-Christopher J. Berry, Esq.
Oakland County Elder Law Attorney