Accelerated remainder refers to a future interest in property that occurs when the original property holder passes away or fails to meet specific conditions. It is granted to a third party who is intended to assume ownership of the property once the preceding estate naturally ends. This type of remainder is called “accelerated” because it transfers to the remainderman immediately, rather than waiting for the natural termination of the preceding estate. It differs from other types of remainders, such as vested remainder and contingent remainder, which have distinct conditions and prerequisites.
An accelerated remainder refers to a future interest in real property that arises for a third person who is intended to receive it after the natural termination of the preceding estate. This occurs when the gift to the preceding beneficiary fails, leading the remainder to pass to the remainderman. For instance, if a grant states “to A for life, and then to B,” but A passes away before B, B’s future interest becomes an accelerated remainder. It is also known as remainder estate or estate in remainder, and it differs from other types of remainders, such as vested remainder, contingent remainder, and cross-remainder, which each have their own distinct characteristics and conditions. Ultimately, an accelerated remainder ensures that the property is transferred to a designated individual after the initial beneficiary’s death or failure to meet the grant’s conditions.
An accelerated remainder refers to a legal concept where the remainder interest in a property is accelerated and becomes possessory before the expiration of a prior interest, such as a life estate.
In a regular remainder, the remainder interest becomes possessory only after the expiration of a prior interest. However, in an accelerated remainder, the remainder interest becomes possessory before the prior interest expires.
To create an accelerated remainder, there must be a clear intention expressed in the instrument creating the interest, such as a will or trust, that the remainder interest should become possessory before the expiration of the prior interest.
Yes, an accelerated remainder can be created in any type of property, including real estate, personal property, or financial assets, as long as the legal requirements are met.
When an accelerated remainder is created, the prior interest is terminated or cut short, and the remainder interest becomes possessory.
In general, an accelerated remainder can be revoked or modified if the instrument creating the interest allows for such changes. However, it is important to consult with an attorney to understand the specific legal requirements and implications.
If the accelerated remainder holder dies before the prior interest expires, the remainder interest will pass according to the terms of their estate plan or the applicable laws of intestacy.
Yes, an accelerated remainder can be challenged in court if there are valid grounds, such as lack of capacity, undue influence, fraud, or mistake, in the creation of the interest.
Yes, there may be tax implications associated with an accelerated remainder, such as estate taxes or capital gains taxes. It is advisable to consult with a tax professional to understand the specific tax consequences.
Yes, an accelerated remainder can be used as a planning tool for estate or asset protection, as it allows for the efficient transfer of property interests and may provide certain benefits in terms of tax planning and asset preservation. However, it is crucial to seek professional advice to ensure compliance with applicable laws and regulations.
This site contains general legal information but does not constitute professional legal advice for your particular situation. Persuing this glossary does not create an attorney-client or legal adviser relationship. If you have specific questions, please consult a qualified attorney licensed in your jurisdiction.
This glossary post was last updated: 17th April 2024.
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