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What Happens to an Estate if a Beneficiary Dies Prematurely?

Posted by Dana Law Group on November 9, 2022

The primary goal of estate planning is to designate heirs for your assets. You may, for example, bequeath a summer home to your son or a stock portfolio to your daughter. But what happens to your assets if a beneficiary passes before you do?

The short answer is “that depends.” If a beneficiary dies before the testator, the estate will be distributed based on verbiage included in the will.

Below, the lawyers at Dana Law Group unpack the legal intricacies of this tragic—though fairly common—situation.

What Is the Difference Between Per Stirpes and Per Capita?

Estate planning can be fairly complicated, especially if a beneficiary dies before the testator. In this situation, the distribution of the estate depends on if the testator opted for a per stirpes or per capita distribution plan.

Per Stirpes Distribution

With a per stirpes distribution plan, property that would have passed to a child who predeceased the parent would now pass to the child’s children.

For example:

John has two daughters: Mary and Nancy. In his last will and testament, he bequeathed all of his assets equally to his two children per stirpes. Mary has two children and Nancy has three. Sadly, Nancy passes away before her father.

A per stirpes distribution would look like this:

Upon John’s death, all assets would be divided between both living and deceased children. Ergo, Mary and Nancy each receive 50% of John’s estate.

Since Nancy is deceased, her portion would be divided equally amongst her three children. Therefore, each grandchild would receive ⅓ of Nancy’s share.

Per Capita Distribution

Per capita distribution is slightly different. Here, the estate is divided evenly amongst all of the surviving beneficiaries.

In the example above, John’s estate would be distributed equally amongst Mary, Mary’s two children, and Nancy’s three children. Ergo, each heir would receive ⅙ of John’s estate.

The 120-Hour Rule in Arizona

In Arizona, other provisions apply to the circumstances detailed above. Specifically, one state law mandates that a beneficiary must survive for at least 120 hours (five days) after the testator’s death to receive their portion of the estate.

Contact a Legal Professional Today

The world of estate planning can be very confusing, what with its legal jargon and caveats. Fortunately, you do not have to navigate this world alone.

If you are amid the administration of a loved one’s estate or have any questions about planning your own estate, please contact Dana Law Group for a consultation with one of our estate law attorneys in Arizona.