By Michael S. Divine
The state of Minnesota provides an easy and efficient way to leave specific gifts of tangible personal property when using a will as your primary estate planning vehicle. Minnesota Statute § 524.2-513 allows the author of a will (“testator”) to refer in a will to a separate written list of items, which must be distributed after the testator’s death. If the legal requirements are carefully followed, the Tangible Personal Property List can save the testator time and money by removing the requirement that an attorney be hired every time the testator wishes to add or subtract a gift of tangible property. If used incorrectly, however, the list can cause additional and unnecessary headaches in the estate administration process.
Background
Historically, a testamentary gift of tangible personal property was written out in a valid will, signed by the testator, and attested to by two witnesses. Each time the testator wished to add or subtract an item, the testator hired an attorney to prepare revisions, and then paid a visit to the law office to execute them. Fortunately, Minnesota law now enables individuals to use a separate list for distributing tangible property, which is easily revised without the assistance of an attorney.
Requirements
An admissible Tangible Personal Property List must meet several requirements:
- There must be a valid will referring to the list. The list itself, however, may be prepared before or after the will is executed.
- The list may only be used to leave tangible property, which is property that can be touched and moved. Specifically, the list may NOT be used to leave real estate, money, coin collections, or property used in a trade/business. Some other items that should not be left on the list are stocks, bonds, inheritances, interests in trusts, life insurance policies, and interests in retirement benefits (IRAs, 401ks, etc.). For instructions on how to leave these assets, please see our article on Beneficiary Designations.
- The items must be described with reasonable certainty.
- The recipient must be described with reasonable certainty.
- The items must not otherwise be specifically disposed of by the will.
- The list must be signed by the testator, or written in the testator’s handwriting.
- Though not strictly required, the list should be dated.
You should also keep in mind that there are laws that may invalidate gifts left on a tangible property list. For example, in Minnesota a spouse’s interest in the deceased spouse’s property is generally superior to any gift left in a tangible personal property list, or a will for that matter.
Pitfalls
While Tangible Personal Property lists are very useful when used correctly, using them incorrectly can add expense and time to estate administration. If a list is improperly prepared, the gifts may fail, and default to the provisions of the will. An improperly prepared list, in particular ones with vague dispositions, may also lead to the probate court requiring a more formal administration, which may increase legal costs. Lastly, an improperly prepared list increases the risk of fighting between heirs, and may lead to litigation.
Conclusion
In summary, a Tangible Personal Property List is a useful part of most estate plans. It is ideal for leaving individual items such as jewelry, automobiles, art, and other household items, but may not be used to leave things like cash and real estate. The list must first be referred to in a will, but may then provide an easy and flexible way to make minor revisions to intended gifts without the need for an attorney. Though not discussed above, a tangible property list may also be used in conjunction with a revocable trust.
We are happy to provide our clients with blank lists and instructions for the proper preparation and revision of Tangible Personal Property lists. Feel free to give us a call, 651-291-1717.
Dudley and Smith has been assisting clients with estate planning for more than 60 years. We have offices located in Saint Paul, Woodbury, Blaine, Bloomington, White Bear Lake, Chanhassen, and Burnsville. We offer free in-person consultations, and happily accept most major credit cards.
This article does not constitute legal advice, nor does it constitute the initiation of an attorney/client relationship. © 2015 Michael Divine.