My second wife says her 2 kids should inherit our estate, but I also have 2 kids. Is that fair?

[Pelican Press 0]

This is the hidden content, please

• Sign In
• or
• Sign Up

My second wife says her 2 kids should inherit our estate, but I also have 2 kids. Is that fair?

“I will leave the $1 million inheritance I received from my parents to my biological daughters.” (Photo subjects are models.) – Getty Images/iStockphoto

I’ve been married to my second wife for 10 years. I will leave the $1 million inheritance I received from my parents to my biological daughters. Everything else first goes to my wife or, if she is not around, is split evenly between my stepkids and my biological kids.

My wife said that, if I die before her, she plans on leaving everything — our remaining estate — to her two children, who are my stepkids. She argues that my biological kids will already have received a big chunk that I am passing down to them from my deceased parents. Is this fair?

The Second Husband

Related:

This is the hidden content, please

• Sign In
• or
• Sign Up

How your community property is divided will depend on who dies first, unless you both agree to write a trust agreement. – MarketWatch illustration

Your inheritance, your choice.

Your community property, the surviving spouse’s choice.

A spouse’s inheritance is deemed separate property. So it is fair to leave it to your own biological children, if that’s what you want to do. Community or marital property, acquired during a marriage, goes to the surviving spouse. They can do whatever they wish with it. Your wife has made her plans clear. If she dies before you do, however, her kids could have a problem, because you plan to split the estate four ways, reducing your stepkids’ inheritance.

So how your community property is divided will depend on who dies first — unless of course you come to an agreement and decide to write a trust agreement. A qualified terminable interest property trust, or a QTIP trust, is not uncommon in second marriages. An A-B trust is another option: The “A” trust is revocable and holds the surviving spouse’s assets, while the “B” trust is irrevocable and holds the deceased spouse’s assets.

For assets that don’t go into a trust, you can name your children as beneficiaries or create transfer-on-death deeds. You should, however, avoid putting their names directly on the deeds to ensure that they can take advantage of the step-up in basis, under which they will only pay capital-gains tax based on the fair-market value of the asset upon your death, rather than based on the original purchase price. An adviser will help you structure your trust or trusts. You can also use life-insurance policies as a way to leave your children an inheritance.

Story Continues

You can also make tax-free gifts to your children during your lifetime. The Internal Revenue Service’s estate-tax exemption on wealth transfers during a person’s lifetime and upon their death is $13.99 million per person for 2025. The annual exclusion for gifts is $19,000 for 2025; it’s double that for married couples. But unless Congress takes action, that exemption is scheduled to revert to the previous level of $5 million in 2026.

It’s unfortunate that you and your wife see things differently when it comes to who will inherit your marital property, but at least you are being honest with each other about your plans. Your wife, for instance, is not promising to split your community property four ways and then waiting until after you’re gone to give it to her two children. That seems to happen — in the pages of this column, at least — more times than I’ve had hot dinners.

This is the hidden content, please

• Sign In
• or
• Sign Up

, for example, said his stepmother, who had been with his father for 25 years, was leaving everything to her two kids. “I had a wonderful relationship with my father as well as my stepmother,” he wrote. “Unfortunately, she doesn’t see it the same way I do. And yes, I have spoken to an attorney, and he basically said that there’s nothing I can do except to speak to her and explain to her why some of the money should come back to me.”

The truth is, there’s no right or wrong answer. Life is not always built on fairness. Rather, it’s built on relationships, alliances and subjective decision-making about who deserves what. Your two children, whatever happens, will end up with a collective inheritance of $1 million. That’s not a bad outcome. Millions of adult children end up with a fraction of that, no inheritance at all, or an estate that has more debts than assets. It seems like you and your wife can disagree amicably.

Related:

This is the hidden content, please

• Sign In
• or
• Sign Up

Previous columns by Quentin Fottrell:

This is the hidden content, please

• Sign In
• or
• Sign Up

This is the hidden content, please

• Sign In
• or
• Sign Up

This is the hidden content, please

• Sign In
• or
• Sign Up

This is the hidden content, please

• Sign In
• or
• Sign Up

#wife #kids #inherit #estate #kids #fair

This is the hidden content, please

• Sign In
• or
• Sign Up

This is the hidden content, please

• Sign In
• or
• Sign Up