Best Practices for Your Estate Plan’s Tangible Property List

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Best Practices for Your Estate Plan's Tangible Property ListWhen it comes to inheritance, there is often a disconnect between what the government cares about and what you care about. The government cares almost exclusively about who inherits your valuables: the million-dollar investment accounts, half-million-dollar houses, and thousand-dollar checking accounts. However, often times the items that we humans care about also includes invaluable items: the fireplace set from your grandmother, the wedding-present fine china set, and your wedding dress.

To solve this disconnect, estate law developed the concept of a personal property memorandum. It is a list of tangible property items with a designation for who should receive them.

In order for this tangible personal property list to be admissible into probate, it must meet a few requirements as defined by the Virginia code. Those requirements are:

A valid will refers to the list. It does not matter when the list was drafted. It could be before or after the will is executed. However, a valid will must refer to the statement or list for the list to be admissible. Here is the reference that my own will has:

I may leave a list or other written statement expressing how I wish certain items of my tangible property to be distributed. I intend that the statement or list be given effect as an amendment of this document.

The list includes specific tangible personal property with clear intended recipients. As the code says, the list must describe, “items of tangible personal property and their intended recipients with reasonable certainty… . Bequests of a general or residuary nature, whether referring only to personal property or to the entire estate, are not specific bequests for the purpose of this section.” Meaning, references to personal property rather than tangible property will be ignored and if the description is too general it may also be ignored.

In general, tangible property is anything you can physically touch (animals included) that you are not holding exclusively for investment purposes (so, bars of gold might be excluded). In Virginia, the code includes a list of tangible property examples in its rules on valuation.

The will does not dispose of the noted items. The items mentioned in the list must not be specifically disposed of by the will. If your will says where the item you want to designate to someone goes, then you have to amend your will to change who receives that item.

The list is signed. For the list to be admissible, it must be signed.

With these rules in mind, here are some best practices.

Date the list. Although not technically required, if you lose track of your first list and decide to write a new one, you’ll want to be able to revoke previous lists without worry about someone trying to utilize the old list. Date each list for this reason.

Make it clear what you are doing. Start the list by clearly stating that this is your personal property memorandum. Mine begins:

This is my written statement (as was mentioned in my will) expressing how I wish certain items of my tangible property to be distributed.

I bequeath the following tangible personal property to the following beneficiaries as listed below:

Describe the items completely. If there is any doubt about which items you are talking about, then it could invalidate the bequest. Don’t say, “my fine china set” — what if you have more than one fine china set by the time your executor is reading this? Be descriptive. “The porcelain fine china set with the butterflies and flowers we received as a wedding present” is much better.

Identify the beneficiaries completely. If your executor cannot identify or get in touch with your beneficiary, then it could hamper the bequest. Include as much identifying information as you have. Minimally, include full legal name and their relationship to you. The relationship to you will help in the event that later down your family tree someone decides to name their child after your heir. After that, you could include birthday, current address, phone number, or even e-mail to aid your executor in identifying and contacting the person.

Make it legible. You can handwrite it or type it out. Both are acceptable, but make sure that it is legible to your executor.

Make changes cautiously. It is safest to destroy the original and create a new one when you want to change the list. If you do make changes on the document, sign and date the amendments so it is clear what was added or removed and when.

Photo by Green Chameleon on Unsplash

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Chief Operating Officer, CFP®, APMA®

Megan Russell has worked with Marotta Wealth Management most of her life. She loves to find ways to make the complexities of financial planning accessible to everyone. She is the author of over 800 financial articles and is known for her expertise on tax planning.