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Avoiding estate fights if parent remarries

Without proper planning, a parent's remarriage can set up a tragic conflict between the new spouse and the children of the first marriage if the remarried parent dies -- particularly if there is a significant inheritance involved.

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Experts say good estate planning, a prenuptial agreement and fine-tuning of the will can help prevent this sort of battle.

"A prenuptial agreement would be pre-emptive on the part of everybody and affect obviously the children when their parent passes," says Mike Silver, certified public accountant and partner with Mallah Furman, an accounting firm in South Florida.

"Everybody has an understanding going into the marriage of what everybody is entitled to along the way. After that, it gets a little sticky."

Where it really gets messy is when the parent remarries and doesn't change his or her life insurance or will, says L. Kelly LaVigne, attorney and vice president of AXA Equitable Life Insurance Co.

"Suddenly you've got a contract that may have been intended for another purpose going back to the estate, going through probate, tying up those funds so that the beneficiate of the estate can't use them," LaVigne says.

"That's why estate planning is so important, even if you don't have a lot of assets. You want to plan ahead and have some kind of will -- even a holographic will, where you just write down everything and sign it in front of a witness. As long as the will shows the intent of the deceased, the courts are pretty accommodating to those intentions."

In some cases, the child's other parent may actually be able to protect the offspring's assets. If the previous marriage ended in death, the decedent spouse could have placed assets into a trust that in case of remarriage of the surviving spouse, the right to invade principle terminates.

But if the marriage ended by divorce, the first step is for the parent and child to sit down and "have a heart to heart about their intentions with their assets," and start looking at ways so everybody can get their share, says Ed Weidenfeld, a former White House counsel who now runs Washington D.C.-based Weidenfeld Law Firm.

Once the children are grown and have families, parents lose the "provider" mentality and may not necessarily think of bequeathing the majority of their assets to them, Weidenfeld says. And when parents remarry, "there is a desire to take care of the surviving spouse for life," Weidenfeld says.

Rock-solid trusts 
In some cases, the best way to stake a claim is to set up a qualified terminable interest property, or QTIP, trust, LaVigne says.

"A QTIP is the only rock-solid way that you can really take care of that surviving spouse who's not necessarily the mother or father of your children and ensure that the remainder is going to be left to your kids and no one is going to have the ability to change that after you pass away," LaVigne says. 

Next: "When these cases go to court ... the stepparent wins."
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