In the realm of estate planning and testamentary matters, there exists a legal concept known as “causa mortis,” which translates to “because of death” in Latin. This term refers to a unique form of gifting personal property, one that is made by someone who is either close to death or foresees their imminent demise. While it is commonly associated with individuals on their deathbed, it’s important to note that a gift causa mortis can also be proper even if the giver is not on the brink of death. Instead, if the person foresees a situation with a high likelihood of death, such a gift can still hold legal weight.
Now, let’s delve into the formal requirements for a gift causa mortis and explore how it sets itself apart from other types of gifts in the context of estate and property law.
How to Make a Gift Causa Mortis
To classify as a gift causa mortis, certain prerequisites need to be fulfilled. Although the specific language might vary among jurisdictions, the common elements remain consistent across the board:
-
Intent: The giver must genuinely intend to transfer ownership of the gift to the recipient. If the transfer is made under duress, threat of violence, or coercion, the intent element may be invalidated.
-
Delivery: The gift must be physically or symbolically handed over to the intended recipient. While physical delivery may not always be practical, symbolic delivery through documentation can also suffice as a means to signify the relinquishment of ownership by the giver.
-
Acceptance: The person receiving the gift must willingly accept it, solidifying the transfer of ownership.
-
In Anticipation Of Death: The gift causa mortis must be made in anticipation of the giver’s imminent death or a situation where death is highly probable.
Examples of a Gift Causa Mortis
To illustrate the workings of gifts causa mortis, let’s consider this scenario: Adam is about to undergo a risky surgical procedure with a fifty percent chance of survival. The night before the operation, he reaches out to his close friend Bob and decides to bestow upon him his cherished collection of baseball cards. Adam hands the book of cards to Bob, who gratefully accepts the gift and takes it home. This exchange constitutes a valid gift causa mortis.
Differences Between Gift Causa Mortis and Regular Gifts
The legal counterpart to a gift causa mortis is an “inter vivos” gift, which translates to “between the living” in Latin. Inter vivos gifts are the standard gifts exchanged between individuals, without any notions of impending death or threats.
The primary distinctions between these two types of gifts lie in revocability, conditionality, and tax consequences.
Revocability of Gifts Causa Mortis
One crucial aspect that sets gifts causa mortis apart from inter vivos gifts is the giver’s ability to revoke the gift while they are still alive. The law permits the giver to retract a gift causa mortis at any point at their sole discretion. In contrast, once an inter vivos gift is made, it becomes irrevocable, granting the recipient complete legal ownership immediately.
Conditionality and Tax Implications
When it comes to a gift causa mortis, the recipient must outlive the giver in order to obtain legal ownership. The potential recipient’s estate and heirs do not hold any legal claim to the gift. Conversely, inter vivos gifts result in the immediate transfer of legal ownership, subject to distribution as outlined in the recipient’s will or through probate law.
In terms of tax implications, gifts causa mortis are considered bequeathed by federal law since they are not deemed complete until the giver’s passing.
Seeking Legal Assistance
Given the emotional and intricate nature of estate planning, it is wise to seek guidance from an experienced estate planning attorney when contemplating a gift causa mortis or engaging in any other estate planning activities. An attorney can provide valuable insights, navigate the complex process, and ensure that your estate planning endeavors meet all legal requirements.
