Per Stirpes: Meaning and Use in Estate Planning

What Is Per Stirpes?

Per stirpes is a Latin phrase that means "by branch." It is also a legal term that may be used for estate planning purposes, such as in a last will and testament. It designates who will inherit assets if a beneficiary passes away before the person who created the will (the testator) dies.

With a per stirpes distribution, the beneficiary's share of the estate will pass to the beneficiary's heirs or descendants.

While the term per stirpes is commonly used to refer to an individual's assets under a will, it is also sometimes used in beneficiary designations within individual retirement accounts (IRAs).

How Per Stirpes Works

Per stirpes refers to every person descending down a branch of a family tree from another person. For example, everyone below a parent, such as their children, grandchildren, and great-grandchildren, is included in a branch.

Per stirpes often appear in wills and retirement accounts to define asset distributions so that each branch of a family tree is treated according to the testator's or account owner’s wishes.

Therefore, if a beneficiary dies before the person whose will names them does, the heirs of that beneficiary would receive the inheritance in an even split.

Children of the beneficiary, as the beneficiary's descendants, would be those heirs. Spouses are not considered in a per stirpes distribution.

Per Stirpes vs. Per Capita

Per capita means “by the heads.” Also called “share and share alike,” the term designates that property is divided equally among surviving descendants in the same generation nearest the testator.

The estate holder names each recipient individually or determines which group receives the assets, such as all the estate holder's children, or grandchildren, or both. A deceased beneficiary's share is not set aside but is mingled with the estate and divided among the other beneficiaries.

For example, Alejandra has specified that her estate be divided per capita among her three children, Abigail, Stephanie, and Oliver.

Abigail has one child, George. Oliver has two children—Hanaj and Anil. If Abigail dies, her portion of the inheritance would remain with Alejandra's other assets and be divided equally among the two remaining children, Stephanie and Oliver. George does not inherit anything, nor do Hanaj and Anil.

Per Stirpes Example

Now consider the same example, but this time, Alejandra's will specifies that her estate be divided per stirpes among her three descendants, her children, Abigail, Stephanie, and Oliver.

Again, Abigail has one child, George. Oliver has two children—Hanaj and Anil. If Abigail dies, her portion of the inheritance would go to George, the next person on Abigail's branch of the family tree.

Hanaj and Anil would not inherit anything.

Criticism of Per Stirpes

Creating a will is one of the most important processes a person can go through. Unfortunately, it can also be one of the most stressful and confusing. Occasionally, the use of outdated terms such as per stirpes can create more confusion, especially when the term isn't used properly.

For example, some lawyers have allowed their clients to use the phrase "to my children, per stirpes." While this may sound straightforward, it is technically incorrect. Instead, the will should read "to my descendants, per stirpes."

Furthermore, different jurisdictions have slightly different definitions of the term. This is why it's critical that every lawyer should take the time to ensure that their client doesn't have any incorrect preconceived notions about the meaning of per stirpes.

The Bottom Line

The distribution of your assets after your death can be very stressful. Making sure that your will has very clear terms—and that those terms reflect your true intentions—can make the process much less difficult for your descendants.

Because some jurisdictions have slightly different definitions of per stirpes, it's crucial that you consult with a legal professional, such as an estate lawyer, when doing your estate planning.