Per Stirpes is a simple method of adding contingent beneficiaries to your will. Deciding who will inherit your assets and estate after you pass away is an important, sometimes difficult, decision. It can be more complicated in cases of large estates or those with many beneficiaries. One way to simplify this process is to use language such as “per stirpes” in your last Will and Testament.
What Is Per Stirpes?
The term “Per stirpes” means “by branch” or “by roots” in Latin. The branches or roots in this legal phrase refer to a family tree, or more specially, the lineal descendants of the testator. The legal effect of per stirpes stipulates that the heirs or descendants of a beneficiary will receive that beneficiary’s inheritance in equal shares if that beneficiary passes away before the testator.
In other words, imagine you devise an inheritance to a family member, but that family member passes away before you do, and therefore, before your estate is distributed. In that case, the share that would have passed to that family member would then need to pass to someone else or lapse. Per stirpes designates that the heirs or descendants of that deceased family member will receive that portion of the inheritance in even shares. Meanwhile, the rest of your surviving beneficiaries would still get what you devised to them.
It should be noted that per stirpes only applies to lineal descendants of the primary beneficiary, such as children and grandchildren. It does not apply to spouses, siblings, or any other relatives of the beneficiary. Per stirpes can be used for any assets in your Will, as well as designations for accounts, like retirement accounts.
To incorporate “per stirpes” into your will, first designate your primary beneficiary and the property they will inherit. Next, state that if the beneficiary predeceases the testator, the assets should be given “to the (beneficiary’s) descendants, (or issue), per stripes.”
Benefits of Using Per Stirpes
Per Stirpes is a simple method of adding contingent beneficiaries to your will. It offers an alternate distribution scheme in the event of an untimely death of one of your beneficiaries. Unfortunately, these things happen, but per stripes is a backup plan for distributing assets to family members.
Primary, Contingent, and Per Capita Beneficiaries
To gain a better understanding of per stirpes, it helps to understand the differences between primary and contingent beneficiaries, and between “per stirpes” and “per capita”.
Primary beneficiaries are the first beneficiaries listed to receive assets in your Will. These are the people who will ideally receive your assets and estate as described in your Will after your passing. On the other hand, contingent beneficiaries only receive your assets if your primary beneficiaries are unable to receive what you had devised to them. So, when using “per stirpes”, the children of the primary beneficiary become the testator’s contingent beneficiaries. The per stirpes distribution is contingent on the primary beneficiary being unable to receive their share.
Just as per stirpes means “by the branch”, per capita means “by the heads”. Per capita designates that the property and assets of the testator are divided equally among their surviving beneficiaries. For example, if the testator has three children, and one passes away before the testator, the designated assets will pass equally to the two surviving children. The heirs or descendants of the one deceased child would not inherit anything.
It is valuable to know all of your options when doing estate planning. Per stirpes is one of the many tools you can use to simplify this process and control the distribution of your estate. If you have any more questions, please contact Ward, Shindle & Hall.
