A will is a must-have for any estate plan, but a will does not normally distribute each and every piece of personal and real property owned by an individual. A Residuary Clause is a provision in a will that disposes of property not expressly disposed of by other provisions, and is often overlooked by those who choose to prepare a will on their own.
Residuary estate is a term used in probate law to identify the portion of an individual’s estate that remains after all specific gifts and bequests have been made and all claims of the estate are satisfied. A will often contains a residuary clause that gives the right to the residuary estate to a named beneficiary or several beneficiaries . Not only does the Residuary Clause handle property that may have been overlooked or not otherwise disposed of; it can handle bequests that are void due to the death of the beneficiary.
For instance, if a will bequeaths a diamond bracelet to your sister, but your sister has passed away, the bracelet becomes part of the residuary estate. The clause will also cover property that is acquired after your will was written, and therefore not specifically mentioned within the will.
If a will omits a residuary clause, the assets not left specifically to anyone would pass to heirs through the intestate succession laws of your state, which apply to the distribution of property for those without a will. However, this would occur only after delays and probate court involvement.
No matter how small your residuary estate may seem when you draft a will, a Residuary Clause needs to be included. Working with an estate planning attorney ensures that wills are properly written and that they address all the necessary aspects of an estate.