If the estate is mostly hard assets, house, art, a business, etc. Those items may be required to be liquidated (sold) in order to pay the taxes the estate owes. The inheritor may want to keep the hard assets intact. As such they could be purchased from the estate for the amount of taxes due.
According to what we’ve been told, this varies by state. We are in Pennsylvania.
In 2020, Luke Gygax, son of Gary Gygax, co-creator of Dungeons and Dragons, filed a will allegedly written by his father after the will his step-mother, Gail Gygax, had filed. The weird thing is that Gary died in 2008, so you would have thought after 12 years everything would have been settled. But it’s 2023, and the case is currently in litigation.
I’m not a lawyer, but what I’ve read suggests if someone has savings only (ie no property or investments), then probate isn’t required. Which will be my father’s situation, if the care home doesn’t take his savings first!
That makes sense.
I guess you’re on the hook in PA. Mi does not tax inheritances or estates.
When my husband and I wrote our wills (in PA), we just signed enough copies to give one original each to my mom, my husband’s mom, and my sister. We also have originals in our safe. I feel like that spreads it out enough (and we’re super simple - one child together, no other children, my husband is an only child and I have just the one sister).
I personally know of three situations (one in MA, one in PA, and one in TX) where the second wife said she couldn’t find a will. In each case the second wife got the majority of the assets, while the kids of the deceased and his first wife (who are my friends) had been told by their dad, “I’m leaving you xxxxx [significant cash or property],” but couldn’t prove it. There’s no way to know if those wishes were never written down, or if they were written down and throw away.
Regarding property and investments, those can be handled outside of probate if the decedent had specified beneficiaries for them. Upon death, the asset goes to the beneficiary without going through the estate. Pretty much everyone should setup beneficiaries for these kinds of assets to greatly simplify the probate of their estate. This would allow the estate to just be the non-standard distributions and who gets the knick-knacks, furniture, and stuff like that.
For your bank and investment accounts, you can set beneficiaries at anytime. Just log into your account and specify their name. For property, you have to file a Transfer on Death Deed with the county court. It’s a pretty simple form and can be done without a lawyer. You can revoke the ToDD at any time or file a new one to change the beneficiary. As property and financial accounts are typically the largest assets in the estate, distributing them through specified beneficiaries would mean the actual estate itself will be relatively small. That makes it easier to distribute and less likely for people to fight over.
Which jurisdiction is this? Everything I’ve read on probate in England states you need probate if there’s property or assets in the bank over £20,000 in the deceased’s name.
The assets going straight to the beneficiaries would be for the US.
As for the point that the estate wouldn’t need probate if it was just savings, I’m not sure about that aspect. That might be for the case where the savings account is jointly held. If the savings is in the name of two people and one dies, the account automatically goes to the other person. No probate is necessary because the account is considered as a “joint tenant” account. The other owner(s) automatically get the assets when one of the JT owners dies. If it was just the decedent on the account, I think that would need to go through probate. The bank would need to see the probate docs in order to authorize the executor to transfer the account to someone else.
If you have elderly parents, it’s a good idea to get added as a joint account holder on their accounts. Not only does it mean you can help with the day-to-day managing of the money, but the account will automatically go to you when they die.
When my father died in AZ in 2021, he had a will but no one ever asked to see it. All anyone asked about to transfer assets or sell his house and car was the death certificate.
Ah, right, it appears it doesn’t work that way here.
As a general proposition, an “estate tax” is levied on the estate, while an “inheritance tax” is levied on the beneficiary.
But I suspect in practice they look the same (and, I imagine, that there is some sort of administrative burden put on the estate even for an inheritance tax). One obvious exception would be if you inherited some sort of tangible property and didn’t want to liquidate it.
That still seems a little strange - my father died in PA a few years ago, and my brother was the executor. It was a simple will - everything was distributed equally between the five surviving siblings. He paid the inheritance taxes out of the estate long before he finished distributing all the funds to us.
AFAIK< and IANAL, they dont do that hardly ever anymore.
Yes, but I think it can be specified?
In CA you could have a holographic will, which certainly could be hidden.
However, generally, no will means probate, in which case instead of the charity, the lawyers get half, so the hypothetical brother loses, especially as his half is a couple years coming.
Yes, except on interest etc earned after death and a few other things.
For all intents and purposes, neither does the USA, unless you are a multimillionaire.
Gail is “a piece of work” as the saying goes. She had her son post some lies on FB and other places accusing one of the TSR writers of theft, since he was selling some of his own assets, including an original draft of a Gygax dungeon the writer did all the other work on.
After some people challenged him, he deleted most of his accusations. There is also the issue of the Gygax memorial funds, which she had control of, and seems to have disappeared…
According to this , it seems the rules in England are similar to the US - perhaps not exactly, because there is no mention of “Transfer (or Pay) on Death” . Beneficial joint tenants seems to be what is called “joint tenancy with the right of survivorship” in the US and apparently life insurance policies get paid to the beneficiaries without needing to go through probate.(although the value of the payout may have something to do with taxes)
You usually need probate or letters of administration to deal with an estate if it includes property such as a flat or a house. Otherwise, you may not need probate or letters of administration if:
- the estate is just made up of cash (that is, bank notes and coins) and personal possessions such as a car, furniture, and jewellery
- all the property in the estate is owned as beneficial joint tenants This property automatically becomes wholly owned by the other owner
- you had a joint bank account
- the amount of money is small
- you discover that the estate is insolvent, that is, there is not enough money in the estate to pay all the debts, taxes and expenses
- there are certain life insurance policies and pension benefits in the estate.
This is what my husband has done with his mom. She’s nearly blind, so she can’t write check or read her statements anyway. We’ve got virtually everything on auto-pay and since my husband is on the account, if his mom wants cash (she likes to keep a couple of hundred on hand because she won’t use debit cards) he can just make a withdrawal for her. So when she dies, he can continue the monthly disbursements she wants to go to her other 2 sons, and that can continue uninterrupted. And since they sold their home and car, there’s no property other than some furniture, so no need for probate as far as we know.
As for my mom, my brother is the executor, and I’m leaving it all up to him. He’ll do what has to be done and divide what’s left among the 5 of us sibs. Lucky for us, he’s very trustworthy, plus probably richer than the rest of us combined.
Well, if he used a lawyer, or filed the will, there could be a way to find out. Anyone who is an interested party can usually file a probate action. So, someone who thinks they are named in a will can file a probate action. If there’s no apparent will, then anyone can ask to be made the administrator of the estate. Research can be done to try to find out what lawyer could have drafted the will, then the lawyer is asked for an executed copy of the will. If they have one, there you go. Sometimes this can be tracked down by looking for payments to a lawyer.
I’m not saying that could have been done in all the examples you mentioned, but there is potentially something that can be done.
On the flip side, my spouse’s father died last year. He had a will leaving everything to her and her brother. But, although he had been separated from his wife for around a decade, they were not divorced. The jurisdiction doesn’t allow a person to fully disinherit their spouse. So, his children have to split the estate with their most recent stepmother.
(No one blames her for taking her share. He was a piece of work. None of his family was on good terms with him. Anyone who was close with him to some degree deserved compensation.)
I’ve seen this go awry. The youngest sibling of five children convinced their mother to do that and put her as a signer on bank account, essentially right of survivorship. The other siblings were not aware that this had happened. The mom, was in her 90’s and primarily just had her house outright.
There was a will and everything was to be divided amongst the 5 kids evenly. The house was sold for about $100k. The bank account turned out, had about $40k in it at the mom’s time of death. Way more than anyone realized. Mom lived very frugally and never turned down help from her children.
The youngest sibling who now had the $40k claimed that that was how mom wanted it. So while all of the other siblings each got $20k, the youngest walked away with $60k. Legally there was nothing the other siblings could do. The other four siblings haven’t spoken to the youngest since mom’s death 8 years ago. I guess the youngest considered the value of her families love was worth about $32,000. Everybody’s got a price.
That’s certainly an exaggeration, except in very small or extremely complicated estates, and it will vary by jurisdiction.
Florida, for example, has statutory guidance on what lawyers should charge based on the size of the estate. They can charge more, but when I was quoted a much higher cost by one lawyer, I pretty easily found one who would charge the statutory fee instead, which was about 20% of what the first lawyer was going to charge. I had no qualms about the 2nd lawyer’s ability to handle the case, either.
My mother died in Iowa just a few months after entering a retirement community that included in its registration materials the question, “where do you keep your will?” She answered something like, “In the front of the top drawer of the black file cabinet in my office.”
There was no will there, though. As I went through her possessions, I came across 3 wills written at different times, in different places, to reflect changes in life circumstances (when my parents moved to Mexico, when my son was born, when my father died). However, none were current as her assets had changed a lot since the last one.
I took all three wills to the attorney, who said, “the law in Iowa is very clear: if a parent dies intestate with an only child, that child inherits everything. So, you didn’t find those out-of-date wills or tell me about them; they don’t exist. I’m good friends with the judge who will handle this case; I’ll keep everything as simple as possible.” And he did.
I was comfortable with that since that was consistent with her wishes. She had a life insurance policy that went to my son, I got everything else, and I faithfully adhered to all her handwritten lists of items (mostly jewelry, crystal, and knickknacks) she wanted to distribute to various friends and family.
So in my case, the existence of THREE wills was hidden - one written in New Hampshire, two written in Mexico, and all ignored in Iowa, where there was no record of them.