Inheritence refers to property and cash that is gifted to someone upon death. When a person executes a Will, property is distributed according to written directives. If there is no Will, assets are distributed according to state probate law.
A Will is required to ensure inheritence property is given to the people you choose. A trust further protects your estate and also offers tax benefits. Without a trust, estates must pass through probate.
Probate can be a simple matter that requires only a few months to settle, or can be prolonged for years if disputes arise or claims submitted against the estate. Intestate estates (those without a Will) can be tied up in probate for months because courts must confirm an estate executor and account for all rightful heirs.
Probated estates must be fully settled before inheritence property can be distributed. Several steps are involved with settling estates. An estate checking account is established. Outstanding debts need to be cleared. Property appraisals are obtained for real estate, automobiles, and other valuables. Date-of-death value forms are obtained for financial accounts.
Probate can become complicated when real estate is involved. Much depends on if property transfers to a surviving spouse or if a mortgage note is attached. If the property is financed, loan installments must continue to prevent the real estate from entering into foreclosure. This can be a heavy financial burden on small estates and force estate executors to sell the property.
In cases where outstanding debts exist, the estate is responsible for clearing debts unless someone chooses to assume debts. If the estate cannot afford to pay off debts, estate executors may be ordered to sell inheritence assets.
One way to prevent this mayhem is to transfer owned assets into a trust. Trusts are exempt from probate and inheritance gifts can be transferred to beneficiaries expediently. Estates protected by a trust can settle in 30 to 60 days. Trusts also offer tax savings.
It's important to remit state and federal taxes when receiving inheritence property and funds. If necessary, consult with a tax accountant. Not all states assess inheritance tax. Those that do normally impose taxes based on fair market value of gifts.
When receiving inheritance cash, consider investing the funds instead of splurging on items you really don't need. Instead, put your loved one's monetary gift to work for you.
If you're unfamiliar with investing strategies, feel free to browse our investing article library which offers everything from depositing funds into high yield savings account to investing in commercial real estate.
People often put off engaging in estate planning. This can be a huge mistake that leaves your loved ones embroiled in court battles or dealing with estate settlement during the height of their grief.
Estate planning is easy and affordable. Basic Wills can be drafted in less than an hour. Regardless of how much or little you own, take time to draft a Will, grant power of attorney rights, and establish a healthcare proxy. These three documents can give you peace of mind knowing affairs are in order should the unthinkable occur. They also assure your inheritence gifts are given to rightful owners.
As a probate liquidator, I have witnessed probate cases extend for over a year. It is estimated only 20-percent of heirs receive intended gifts. If you are entitled to probated property and want to obtain cash for inheritance, visit the 'Forms' section to provide information. Upon review, I will contact you to discuss details of your forthcoming inheritence.