Definition:
Disposable Portion refers to the portion of an individual’s assets or property that they have the freedom to distribute to any person of their choosing upon their death.
The disposable portion refers to the part of a person’s property that they can freely distribute through their will. For instance, let’s consider John who has a total estate worth $500,000 and two children. However, he wants to allocate a portion of his estate to his favorite charity. According to the laws of John’s state, he must leave at least half of his estate to his children, but the remaining half (or less, depending on the state) is his disposable portion. John has the freedom to leave this portion to his preferred charity, a friend, or anyone else he desires. Another example involves Sarah, who has a total estate worth $1,000,000 and three children. Sarah wishes to leave a larger portion of her estate to her youngest child with special needs. As per Sarah’s state laws, she must leave at least one-third of her estate to each child, but the remaining third (or more, depending on the state) is her disposable portion. Sarah can choose to allocate a larger portion to her youngest child and divide the rest among her other two children. These examples demonstrate how the disposable portion grants individuals greater control over the distribution of their property after their demise. It allows them the liberty to leave a portion of their estate to someone who may not be a direct family member or to distribute their assets in accordance with their personal values and beliefs.
A disposable portion refers to the remaining assets of an estate after all debts, taxes, and specific bequests have been paid or distributed.
The disposable portion is calculated by subtracting the total debts, taxes, and specific bequests from the total value of the estate.
The disposable portion is typically distributed among the residuary beneficiaries named in the deceased person’s will or, if there is no will, according to the laws of intestacy.
In some cases, the distribution of the disposable portion can be contested if there are disputes over the validity of the will or if there are claims of undue influence or lack of mental capacity by the deceased person.
Yes, the deceased person can specify in their will how the disposable portion should be distributed among the residuary beneficiaries. However, this can be subject to legal challenges if it is deemed unfair or against public policy.
Creditors have the right to make claims against the estate to recover any outstanding debts. If the debts exceed the value of the disposable portion, the creditors may receive a portion of it.
Yes, funeral expenses are typically considered a priority debt and are paid from the disposable portion before any distribution to beneficiaries.
Yes, depending on the jurisdiction, the disposable portion may be subject to inheritance tax or estate tax, which is calculated based on the value of the assets being distributed.
Yes, the deceased person can choose to leave a portion or the entirety of the disposable portion to a charitable organisation through their will or other legal instruments.
In some cases, certain assets within the disposable portion may be protected from creditors if they are held in specific types of trusts or if they are exempt from creditor claims under applicable laws. However, this can vary depending on the jurisdiction and specific circumstances.
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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