Last week I compared two mechanisms for equalizing children’s inheritances where one (or more) of the children received a financial gift during a parent’s lifetime.

One method is a hotchpot clause in the will. The other is documenting the gift as a loan. I listed the benefits of each mechanism with a plan this week to create and provide an example will clause that would achieve the best of both worlds.

Here is a draft I came up with.

"When dividing the residue of my estate among my children, I direct my executor to take into account any gifts I have made to any of them during my lifetime and which I have decided should be taken into account on my death when determining their inheritance for the purpose of ensuring fairness between my children.

Any gifts to be taken into account will be listed on a ledger I have kept for that purpose, entitled “Ledger of gifts to be taken into account........

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