Inchoate Interest

AAA

DEFINITION of 'Inchoate Interest'

Interests, generally property interests, that are likely to vest but have not yet actually done so. The inchoate interest usually is dependent on an event occurring that triggers the interest, such as a relative's death triggering an inheritance. The interest that the inheriting relative has in the inheritance is inchoate until the death occurs, at which point it becomes a real interest.


INVESTOPEDIA EXPLAINS 'Inchoate Interest'

Note that inchoate interests are not certain to vest. There is still the possibility of a change in circumstances that would prevent the interests from vesting or occurring.

RELATED TERMS
  1. Vesting

    The process by which employees accrue non-forfeitable rights ...
  2. Copyright

    The ownership of intellectual property by the item's creator. ...
  3. Inheritance

    All or part of a person's estate/assets that is given to an heir ...
  4. Intangible Asset

    An asset that is not physical in nature. Corporate intellectual ...
  5. Tangible Asset

    Assets that have a physical form. Tangible assets include both ...
  6. Revocable Trust

    A trust whereby provisions can be altered or canceled dependent ...
Related Articles
  1. Getting Started On Your Estate Plan
    Options & Futures

    Getting Started On Your Estate Plan

  2. Three Documents You Shouldn't Do Without ...
    Options & Futures

    Three Documents You Shouldn't Do Without ...

  3. An Estate Planning Must: Update Your ...
    Options & Futures

    An Estate Planning Must: Update Your ...

  4. Refusing An Inheritance
    Retirement

    Refusing An Inheritance

Hot Definitions
  1. Leading Indicator

    A measurable economic factor that changes before the economy starts to follow a particular pattern or trend. Leading indicators ...
  2. Wage-Price Spiral

    A macroeconomic theory to explain the cause-and-effect relationship between rising wages and rising prices, or inflation. ...
  3. Accelerated Depreciation

    Any method of depreciation used for accounting or income tax purposes that allows greater deductions in the earlier years ...
  4. Call Risk

    The risk, faced by a holder of a callable bond, that a bond issuer will take advantage of the callable bond feature and redeem ...
  5. Parity Price

    When the price of an asset is directly linked to another price. Examples of parity price are: 1. Convertibles - the price ...
  6. Earnings Multiplier

    An adjustment made to a company's P/E ratio that takes into account current interest rates. The earnings multiplier is used ...
Trading Center