Per Stirpes Definition: How To Name Beneficiaries in a Will

When planning your estate, you likely have thoughts about who should receive portions of your property after you pass away, such as your spouse receiving the home or your children taking sentimental belongings. But have you considered who should be the “backup” beneficiary? It's crucial to also have contingencies for distributing your assets in case a beneficiary predeceases you. An effective way to address this scenario is by using a concept known as "Per Stirpes distribution." This term, in a legal context, denotes an efficient way of distributing an estate where the beneficiaries are sorted into groups, typically by a generational degree of relationship.

"Per Stirpes" is a Latin term frequently used in estate planning and wills to dictate how assets should be allocated if one of the beneficiaries dies before the testator (person who created the will). It is used to determine who will inherit the deceased beneficiary's share. With per stirpes distribution, in cases where one of your beneficiaries passes away before you, the descendant's share of your estate is passed on to their offspring. A per stirpes distribution ensures your legacy is distributed exactly as you intended, even in unexpected circumstances.

A per Stirpes distribution is beneficial in cases where you wish to ensure your estate maintains a specific allocation, especially among direct descendants such as children and grandchildren.

For instance, imagine you have three children — David, Edward, and Fiona — and you intend for each to receive an equal share of your estate. However, if David were to pass away before you, leaving two children of his own, a per stirpes distribution would ensure that David’s children receive his share of your estate, divided equally. In this example, David's children would each inherit one-sixth of your estate, while Edward and Fiona would each receive one-third.

Contrasting to per Stirpes distribution, per capita distribution divides property equally among the descendants of the nearest generational degree to the testator. Each beneficiary is listed individually, such as the testator's children or grandchildren. In a per capita distribution, a deceased beneficiary's share is not set aside and is instead lumped with the rest of the estate, then equally divided among other recipients. For example, using the names from above, if Beth had divided her estate per capita and David had predeceased her, David's share would be combined with the remaining estate and evenly split between Edward and Fiona — the living children. Thus, David's children would not inherit anything.

Per stirpes distribution may not always be the best option. For instance, if you prefer to evenly distribute your estate only among the living beneficiaries without consideration for deceased beneficiaries' offspring, or if you want specific individuals (primary or contingent beneficiaries) to gain from your estate. In blended families, per stirpes distribution only legally considers biological or adopted children, leaving out stepchildren. Consequently, if David had one biological child and one stepchild, only David's biological child would receive a portion of your estate under per stirpes distribution, excluding the stepchild.

To mitigate potential disputes over your will after you pass away, mapping out your primary and secondary beneficiaries is recommended. In our previous example, if David passed away before you, his two children would inherit his share of your estate equally with per stirpes distribution. You could exclude anyone from inheriting assets from your estate and consider including a no-contest clause in your will, provided it's permitted in your state.

To streamline the process of your assets and property distribution upon death, your last will template should outline how your estate should be divided into beneficiaries. Not only does this serve as a binding contract to ensure that a probate court can distribute your estate to your chosen heirs effectively, but it also prevents unnecessary stress and disagreements amongst family members regarding the division of your estate after your death.

Per stirpes distribution counts for any number of generational degrees. If a beneficiary dies before the testator, the inheritance would get passed down to the beneficiary's descendants (children, grandchildren, and so on, however distant) by default. So in essence, per stirpes covers as many generations as are represented among the legal heirs of the deceased beneficiary.

In per stirpes distribution, if a beneficiary dies ahead of the testator, the inheritance intended for the beneficiary will pass to the beneficiary’s children or heirs. All descendants within a family tree fall under a per stirpes distribution, regardless of the degree of relationship or generation. If a parent passes away before the testator, their child may stand in the parent's place and by induction, receive the inheritance that was to go to the parent.

Wrapping up, for these reasons, it's advisable to seek advice from a knowledgeable estate planning attorney or lawyers near you to help ensure your wishes will be followed in accordance with 2022 estate laws.