Making gifts or loans to your children? Mention this in your will

lastwillMany parents make gifts or loans to their children. Often they give more money to one child than to others, perhaps because one child has a greater need.

If you do make a significant gift or loan to one of your heirs, you should modify your will to address it.

The reason: If something happens to you, it might be unclear to your heirs what the effect of the gifts or loans should be on their inheritance. In some families, this kind of uncertainty can lead to family battles and even a legal challenge to the will. But even if this doesn’t happen, some children might be quietly offended or simply uncertain, and you probably want to avoid that if possible.

So if you are leaving some children more assets in your will than others as a result of gifts made during your lifetime, it’s a good idea to explain your reasoning in your will. If you’re leaving all your children equal shares in spite of having given some of them more gifts than others in your lifetime, you should say that as well – so there’s no question whether the lifetime gifts should be treated as an “advance” on their inheritance.

What if a loan is outstanding at the time you die? You might want to make clear that any such loan doesn’t have to be repaid, and doesn’t affect the distribution in your will. On the other hand, if you want the loan to be treated as an advance against an inheritance, you should make that clear.

If you want a loan to be repaid after your death or to be treated as an advance against an inheritance, then you should have a written loan agreement with your child. You might also want to specify in the agreement that any forgiveness has to be in writing, so your child can’t claim after you die that at some point you forgave the loan.

Are GM and Chrysler still liable for their lemons?

What if you or someone you know is injured as a result of a defect in a GM or Chrysler car? Are these companies still responsible for problems with their products now that they’ve been through bankruptcy?

The answer to this is somewhat complicated.

The good news is that people who are injured in cars that were manufactured by GM or Chrysler after the companies emerged from bankruptcy will have the right to recover from the company for their harm.

The bad news is that people who were injured before the bankruptcy, but haven’t been paid yet, will have their claims mostly wiped out. In the case of GM, this means that hundreds of people who had filed more than $1 billion of personal-injury claims due to defective manufacturing will recover little or nothing from the company, no matter how valid their claims are.

The next question is: What will happen to people who are injured after the bankruptcy as a result of defective cars that were manufactured before the bankruptcy?

In the case of GM, these people will be able to sue the “new” GM for their injuries. But in the case of Chrysler, the victims will be out of luck.

In any event, if you or someone you know is injured in an auto accident, it’s critical to speak to an attorney right away. There may be other ways to recover for your injuries, and you can’t be sure unless an attorney thoroughly analyzes your particular situation.