RESIDUARY GIFT
Back to GlossaryDefinition
What is left after any specific or pecuniary gifts have been made from the estate and all expenses and taxes have been paid.
Summary
A residuary gift is essentially what's left over in someone's estate after all the specific items, cash amounts, debts, taxes, and administrative costs have been taken care of. Think of it as the 'remainder' of an estate - like when you're dividing up a pizza and after giving specific slices to certain people, whatever is left goes to the residuary beneficiary. This is often the most valuable part of an estate and typically goes to close family members or main beneficiaries.
Usage Context
Understanding residuary gifts is crucial when studying estate planning, will drafting, probate procedures, and inheritance law. This concept is particularly important when analyzing how estates are distributed and ensuring all assets are properly accounted for in estate planning documents.
Common Confusions
- Students often think the residuary gift is just leftover money, when it can include any remaining assets
- Confusion about whether debts and taxes come out before or after calculating the residuary gift
- Mixing up residuary gifts with specific bequests or cash gifts
- Not understanding that the residuary gift can be worth more than specific gifts
- Thinking that if someone doesn't want the residuary gift, it automatically goes to the state
