Asset division not according to Will = Gift Tax Return?

A father makes a will that states that he each of his three children are to receive 1/3 of his assets. After making the will, he gives 2 of the children a gift but not the third. The father and the three children agree that the father will amend the will to leave 90% of his assets to the third child who did not receive a gift and 5% each to the two children who did. The father then immediately dies without making the modification to the will. All three children are in agreement that the new 90/5/5 agreement should rule. Are the children able to modify the distributions from the estate in this manner, or do they need to stick to the 1/3 each and then make a gift (and file gift tax returns) to the child who should have received the larger share?

Thank you

In most states the other two can disclaim all or part of their inheritance in favor of the third one so s/he can receive what was intended. I believe no gift exists from the two who disclaim. This is lawyer territory.

The disclaimers can get tricky as the other two have no say in where the funds go after they disclaim, it falls to the beneficiary designations, document plans, state law, etc. Many times you start the disclaimer process and then realize it opens up a can of worms and just opt for the beneficiaries following the will and then gifting after the fact. In one case, the disclaimer was going to result in additional CT probate assets and CT has a pretty hefty probate assessment

If the disclaimer rules are not clear (will says, if any child disclaims, his/her interest goes to the other children) then perhaps you can go to court and get the court to essentially change the will to reflect dad's intention. Agree with above - see atty.