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The ‘devise’ is the cornerstone of passing on real property in a will. Learn the vital distinctions between specific, general, and demonstrative devises and how the doctrines of ademption and abatement protect or nullify your inheritance wishes. Essential reading for secure estate planning.
The Legal Mechanism of “Devise of Real Property” in Estate Planning
For individuals and families, real property—a primary residence, vacation home, or undeveloped land—is often the most significant asset in an estate. How this property is legally transferred through a will is governed by a precise legal concept: the devise of real property. Understanding this term and its associated doctrines is fundamental to ensuring your estate planning wishes are honored and avoiding complex family disputes during the probate process.
A “devise” is, in traditional legal parlance, a testamentary disposition—a gift made through a last will and testament—specifically concerning real estate. While modern statutes, such as the Uniform Probate Code (UPC), have broadened “devise” to sometimes encompass gifts of both real and personal property, its core association remains with land and buildings. The person making the gift is the testator, and the recipient is the devisee.
1. Devise vs. Bequest: A Historical and Modern View
Historically, the distinction between terms used in a will was critical and rigidly maintained in common law:
- Devise: A gift of real property (land and buildings).
- Bequest (or Legacy): A gift of personal property (money, jewelry, stocks, etc.).
Today, many jurisdictions have streamlined this language. For instance, under the UPC, the term “devise” is often used universally to refer to any property—real or personal—transferred via a will. Nonetheless, utilizing precise, traditional terminology is still considered best practice when drafting specific clauses for real estate transfers.
A general devise of real property typically does not include the personal property or contents located on or associated with it (e.g., furniture, coin collections), unless the will explicitly directs their inclusion. Always specify if you intend to include the home’s contents with the real property.
2. The Three Critical Classifications of Devises
Devises are classified based on the nature of the property being transferred. These classifications determine how the gift is handled if the estate lacks sufficient assets or if the property is disposed of before death.
| Type of Devise | Description | Legal Implication |
|---|---|---|
| Specific Devise | A gift of a particular, distinct piece of property (e.g., “my mountain cabin at 456 Peak Lane”). | Most protected from abatement. Subject to ademption if sold or destroyed before death. |
| General Devise | A gift of a specified quantity or value, payable from the general assets of the estate (e.g., “$50,000 cash to my nephew”). | Fulfilled from any asset of the same type. Not subject to ademption. |
| Demonstrative Devise | A general gift payable from a specific fund or source (e.g., “$10,000 from the sale of my rental property”). | If the source is insufficient, it converts to a general devise. It is a hybrid of the two. |
| Residuary Devise | A gift of whatever remains in the estate after all other devises, debts, and taxes are settled. | Most vulnerable to abatement. If a non-residuary devise fails, it typically falls into the residuary estate. |
3. The Protective and Punitive Doctrines: Ademption and Abatement
Two fundamental doctrines in estate law profoundly affect how a devise is carried out, especially concerning real property.
Ademption by Extinction
Ademption applies only to a specific devise. If the specific piece of property named in the will is no longer owned by the testator at the time of death (e.g., it was sold, destroyed, or stolen), the gift is extinguished (nullified). The devisee is generally not entitled to a substitute asset or the cash proceeds from the sale of the property, though some states offer exceptions based on the testator’s intent or the circumstances of the sale.
Abatement
Abatement is the process used when an estate’s assets are insufficient to satisfy all the devises and cover all debts, expenses, and creditors’ claims. The law dictates a strict order in which gifts must be reduced or eliminated to cover the shortfall. This order is a hierarchy of protection, with specific devises being the most protected:
- Residuary devises are typically reduced first.
- General devises are reduced next.
- Demonstrative devises are reduced third.
- Specific devises (including real property) are reduced last, meaning they are the most protected gifts.
If you specifically devise a home to your daughter, but later sell that home and buy a new one, the gift to your daughter may fail entirely (ademption), and she will not receive the new property unless you update your will. Regular review and amendment are essential for specific devises.
4. Non-Probate Real Property Transfers
A will and its devises only control assets that are part of the probate estate (property solely in the testator’s name). Real property can often be transferred entirely outside the will, meaning the devise provision is ineffective for that asset. These are known as non-probate transfers:
- Joint Tenancy with Right of Survivorship: The property automatically transfers full ownership to the surviving joint owner(s) upon the decedent’s death, bypassing the will and probate.
- Transfer-on-Death (TOD) Deed: Allowed in many states, this deed names a beneficiary to receive the property upon the owner’s death, allowing the transfer to happen automatically and avoiding probate.
- Real Property in a Trust: If the property is titled in the name of a revocable living trust, the trust document dictates the transfer, and the property avoids probate entirely.
5. The Final Step: Transfer, Taxes, and the Step-Up in Basis
Once the will is validated through the probate process, the Executor (or personal representative) is responsible for distributing the devised real property to the named beneficiary. This usually involves filing a new deed to transfer title into the devisee’s name.
A significant financial advantage of inheriting (receiving a devise) over receiving a lifetime gift is the Step-Up in Basis for capital gains tax purposes. This can dramatically reduce the tax liability if the devisee later sells the property.
Concept Spotlight: Step-Up in Basis
When real property is received through a devise at death, the property’s cost basis for the beneficiary is “stepped up” to its fair market value on the date of the testator’s death.
Example: A testator purchased a home for $100,000. At the time of their death, the home is valued at $500,000. If the devisee sells the home immediately for $500,000, their taxable capital gain is $0 ($500,000 sale price – $500,000 stepped-up basis), avoiding tax on the $400,000 appreciation.
Summary of Devise of Real Property
To summarize the complex process of devising real property, here are the key takeaways for effective estate planning:
- Specificity is Paramount: Clearly identify the real property you intend to devise (a specific devise) using its address and legal description, and explicitly state who the beneficiary is.
- Understand Ademption Risk: Be aware that if you sell a specifically devised property during your lifetime, the gift may fail unless you update your will to reflect the change.
- Review Property Title: Check how your real property is titled. If it is held in joint tenancy, a trust, or with a TOD deed, your will’s devise provision will be overridden.
- Address Encumbrances: The common law rule of exoneration (where the estate pays off the mortgage) has been modified or abolished in many states. If you want the devisee to receive the property free and clear of a mortgage, you must explicitly direct the Executor to pay the debt from other estate funds.
Your Real Property, Your Legacy
Devising real property is more than just naming a recipient; it is a meticulously structured legal act. By correctly using specific, general, and residuary devises—and understanding how doctrines like ademption, abatement, and the step-up in basis impact your plan—you empower your Executor to carry out your wishes smoothly, preserve the value of your legacy, and minimize the administrative and tax burden on your loved ones.
Frequently Asked Questions (FAQ)
Yes, you can. The property will pass to the devisee, but they may receive it subject to the existing debt (mortgage). In some cases, the estate may be obligated to pay off the debt, but you should specify your intent clearly in the will, as the historical rule of exoneration has changed in many jurisdictions.
If a devisee predeceases the testator, the devise will typically “lapse” or fail. However, most states have anti-lapse statutes that may direct the property to the devisee’s descendants, unless your will explicitly states otherwise (e.g., by using terms like “to my surviving children”).
It depends on your goals. A devise through a will requires the property to go through probate, which can be costly and time-consuming. Using a revocable living trust or a Transfer-on-Death (TOD) deed (if available in your state) may allow the property to bypass probate entirely, leading to a quicker and more private transfer.
The residuary devise is the catch-all provision in a will that disposes of any property not specifically devised or that fails to transfer (lapses). It is critical because it prevents the remaining assets from being distributed according to state intestacy law (dying without a will for that property).
Concluding Thoughts and Next Steps
Navigating the legal landscape of property transfer at death requires careful planning. Whether you are dealing with a simple specific devise of a family home or a complex distribution involving multiple properties and different types of devises, the precision of your will is the most critical factor. We strongly recommend consulting with an experienced Legal Expert or Financial Expert to review your estate plan, ensuring your intentions regarding your real property are clearly and legally documented, minimizing the risk of ademption, and taking full advantage of tax benefits like the step-up in basis.
— The Professional Legal Blog Team
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