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What makes an heir and a beneficiary different?

On Behalf of | Jan 12, 2021 | Estate Planning & Administration |

In Pennsylvania and the rest of the country, there are laws for estate administration that control how people can gain ownership of properties. If you don’t understand this process, the first step is to learn the role of an heir and a beneficiary.

Can someone interchange both terms?

An heir and a beneficiary aren’t the same, so someone can’t call one individual an heir and a beneficiary. The differences are subtle; however, anyone who is going to develop an estate plan with a lawyer or with a financial advisor must fully understand what laws apply to an heir and the laws for a beneficiary.

Basically, anyone related to the deceased can be an heir. However, an heir doesn’t always receive assets. A beneficiary is someone listed on a will. According to the law, a beneficiary can be an heir.

Can an heir be a beneficiary?

There are many steps to take when it’s time to claim a property. From a legal standpoint, heirs aren’t beneficiaries because an heir’s procedures for claiming assets are different. For example, the heirs will get the news first after someone passes away. However, this process doesn’t ensure that the heirs will gain access to the assets. A will is the key; if one was prepared, an estate executor will determine how to distribute the assets among the heirs according to the will.

Who can contest a will?

An heir can contest a will for various reasons. For example, someone who is an heir could contest a will if the signature seems to be forged. The process of contesting a will during the estate administration process can be time-consuming and costly. Even if you understand the differences between an heir and a beneficiary, you’ll be less likely to run into problems after hiring a lawyer.