What happens when a beneficiary dies before all estate assets are distributed?

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What happens when a beneficiary dies before all estate assets are distributed?

My aunt and uncle passed away. My cousin and I were co-executors. Some money was lost to the state and there is still a small amount of unclaimed property. My cousin and I were supposed to share all money and stocks equally. My cousin has passed away. If I can get the lost money and stocks back, do I have to split it with my cousin’s estate?

Asked on July 18, 2014 under Estate Planning, Texas

Answers:

M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney

Answered 6 years ago | Contributor

Since it appears that your cousin died after probate was opened but before the final distribution of assets, then their estate is entitled to 50% of any lost money and/or stocks that are recovered. This is true even if probate had not yet been opened. In fact, this would still be the case if your cousin predeceased your aunt and uncle due to what are known as "anti-lapse" statutes. These laws (on the books in virtually all states) provide that when a beneficiary predeceases the maker of a Will, then unless otherwise provided in the Will itself, the deceased benenficiary's heirs are entitled to their share of the estate.


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