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  • ICCT Colleges Foundation, Inc. Transfer and Business Taxation (Blo4) Chapter 1 - Activity

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    Joyce Mae D. Flores
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    This document defines key terms related to wills and inheritance: A devisee inherits real property from a will, while a legatee inherits personal property. A legitime is a statutory fraction of an estate that must pass to heirs. A will allows a person to choose heirs and executors. A codicil makes minor changes to an existing will without rewriting it. A holographic will is a handwritten will in some states that does not require legal formalities.

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    This document defines key terms related to wills and inheritance: A devisee inherits real property from a will, while a legatee inherits personal property. A legitime is a statutory fraction of an estate that must pass to heirs. A will allows a person to choose heirs and executors. A codicil makes minor changes to an existing will without rewriting it. A holographic will is a handwritten will in some states that does not require legal formalities.

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    85 views2 pages

    ICCT Colleges Foundation, Inc. Transfer and Business Taxation (Blo4) Chapter 1 - Activity

    Uploaded by

    Joyce Mae D. Flores
    This document defines key terms related to wills and inheritance: A devisee inherits real property from a will, while a legatee inherits personal property. A legitime is a statutory fraction of an estate that must pass to heirs. A will allows a person to choose heirs and executors. A codicil makes minor changes to an existing will without rewriting it. A holographic will is a handwritten will in some states that does not require legal formalities.

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    © All Rights Reserved
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    ICCT Colleges Foundation, Inc.

    TRANSFER and BUSINESS


    TAXATION (BLO4)
    CHAPTER 1 – ACTIVITY
    ANSWER:
    a. Devisee
    • A devise is a gift of real property by will. In the income tax law, the term is used
    mainly in connection with determining the basis of property so acquired. Basis of
    property acquired by devise is the value at the date of death of the decedent, or at
    the alternate valuation date if elected for estate tax purposes. A devise is excluded
    from gross income for federal income tax purposes.

    b. Legatee
    • The literal meaning of a legatee is one who receives a legacy. Specifically, in the
    law of wills and property, a legatee is an individual who receives a portion of a
    testator’s estate, or rather the individual receives a legacy, which is personal
    property from a will. Although this term legatee is generally used to refer to
    individuals who inherit from a will regardless of whether it was real property or
    personal property, an individual who inherits real property from a will is known
    as a devisee. Additionally, an organization can be a legatee if the organization is
    inheriting personal property from a will. The closest modern word equivalent to a
    legatee would be a beneficiary. The term beneficiary is sometimes used instead of
    legatee since it avoids the distinctions of legatees receiving personal property and
    devisees receiving real property.

    c. Legitime
    • The legitime is usually a statutory fraction of the decedent's gross estate and
    passes as joint property to the decedent's next-of-kin in equal undivided shares.
    The legitime cannot be infringed in order to give a spouse or other beneficiary a
    greater share of the estate. Therefore, when a decedent has children and leaves a
    will, it is unlawful for the testator to override the legitime by special gift which
    exhausts the estate or by designating his spouse or other person as sole
    beneficiary. This is known as preterition when arising by omission and
    disinheritance when heirs are expressly deprived.
    d. Will
    • A will is the legal instrument that permits a person, the testator, to make decisions
    on how his estate will be managed and distributed after his death. A will serves a
    variety of important purposes. It enables a person to select his heirs rather than
    allowing the state laws of descent and distribution to choose the heirs, who,
    although blood relatives, might be people the testator dislikes or with whom he is
    unacquainted. A will allows a person to decide which individual could best serve
    as the executor of his estate, distributing the property fairly to the beneficiaries
    while protecting their interests, rather than allowing a court to appoint a stranger
    to serve as administrator. A will safeguards a person's right to select an individual
    to serve as guardian to raise his young children in the event of his death.

    e. Codicil
    • A codicil effectuates a change in an existing will without requiring that they will
    be reexecuted. The maker of the codicil identifies the will that is to be changed by
    the date of its execution. The codicil should state that the will is affirmed except
    for the changes contained therein. The same formalities that are necessary for the
    valid execution of a will must be observed when a codicil is executed. Failure to
    do so renders the codicil void.

    f. Holographic Will
    • A holographic will is a handwritten and testator-signed document and is an
    alternative to a will produced by a lawyer. Some states do not recognize
    holographic wills. States that do permit holographic wills require the document
    meet specific requirements to be valid. The minimal requirements for most states
    are proof that the testator wrote the will, evidence that the testator had the mental
    capacity to write the will, and the will must contain the testator's wish to disburse
    personal property to beneficiaries.

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