An Inheritor is a person who inherits something – an heir. Many people use the terms “heir” and “beneficiary” interchangeably, but there are important differences between the two designations. Here’s how an heir and a beneficiary differ:

Who is an heir?

An heir is a relative who is legitimately entitled to an inheritance from the estate of a deceased relative when the deceased’s last will and testament was not lawful.

When there is no will, which is called the “dying intestate,” an estate usually transfers in specified shares to the nearest living relatives, then to more distant relatives if close relatives do not live. Although in the strict sense of the word a surviving spouse is not a beneficiary, a spouse or registered domestic partner is usually first in line for assets under the marital or community property laws of a State.

Assets move first on to a living partner and/or immediate descendants (children and/or grandchildren, both parental and adopted). If they don’t live then to parents, and if they don’t survive, to grandparent descendants (aunts, uncles, and cousins). When all the heirs are dead, then the estate’s properties transfer to the state, which is known as escheatment.

Who gets how much is dictated by the specific laws of intestate succession of each state, which are the blueprints of how an estate will be divided if an individual dies without a valid Will? This is the responsibility of the probate court to ensure that the estate’s net assets transfer to the individuals legally entitled to it.

What isn’t their heir?

No matter the duration of the engagement, an unmarried partner wouldn’t be considered a successor. Nor should relatives, stepchildren, in-laws, spouses legally separated, foster children, or a charity come near. It is one reason why ensuring you have a valid last will and testament is so critical if you want to give your estate to someone who is not your legal heir.

What is a Beneficiary?

A beneficiary is an individual or entity that receives money or property because, in their Will or Trust, someone expressly names them. Beneficiaries can include charities, places of worship, a close relative of a deceased or even his pet cat. If you’re appointed explicitly in a Will, you’re considered a beneficiary.

Can You Be Both a Beneficiary and an Heir or Vice Versa?

This is where it can get confusing. You may be a beneficiary who is also an heir, but not all beneficiaries are heirs. For instance, if your mother wishes you to have her pearl necklace, if you are explicitly listed in the Will, you are a beneficiary. Yet you may also be called a descendant, since you are the relative of the blood of your parents.

At the other hand, let’s presume your father leaves it all to Roger, his closest boyhood mate. Roger is considered a beneficiary. Since he’s not a blood relation, Roger can’t be an heir, even though your father considered him a “family,” you’re really a heir in this case because you’re a blood relative. Yet Roger probably would still get all the money from Dad because you’ve not been named in the will.

Who Has More Rights to Items: An Heir or a Beneficiary?

It depends on whether official records, such as Wills and Trusts, exist or not. If a Will exists, recipients like Roger may also have more access to the properties that remain after probate. The assets go on to the first heir in line when there is no Will. These heirs are mostly adult children or partners. The cycle continues until a relative of living blood is found.