Sis is the executrix of Dad's estate, unfortunately willing to seek professional guidance regardless of our encouragement, so please bear with me. Dad died in 12/2011 and his estate is not yet settled. However, in 2012 she issued checks totally around $35,000 to each of the siblings, feeling that there was no need to keep it all intact while the estate settled. She has kept a significant amount still in the accounts in order to deal with bills, taxes, etc.Since she issued those checks in 2012, and we are now in 2013 with the estate not yet settled, is there gift tax to pay? Does that come from the individual or the estate?TIA,IP
I am sorry for your loss. I understand, my father passed away a few months earlier. There is no gift tax. If there are estate taxes due, then the estate would likely pay it. From your previous post, there was an inherited IRA. There could be a situation where there aren't sufficient assets outside of an IRA to cover estate taxes. It doesn't sound like that is this situation. Now for difficult issues. Was a personal income tax return filed for 2011? Since your father passed away so late in 2011, almost all of the income would be allocated to his income and not the estate. An estate return might not be required for 2011.She should have obtained a TIN for the estate, and transferred the undistributed accounts to the estate. If there was over $600 in income during 2012, an estate income tax return needs to be filed, and K-1s issued. If she hasn't transferred the remaining assets to the estate. A personal income tax return would need to be filed to transfer the income to the estate. If your father had a trust, then probate might not be required. Given the assets you have listed, there was enough assets to require probate if there wasn't a trust. She isn't seeking professional help, so there can't be those bills. If there is real estate, then there could still be expenses to cover. Other than expenses for real estate, I don't see any reason that there would still be unpaid bills. I was surprised at how quickly final medical bills were submitted to insurance and processed.
Thank you, yes...She has done all those things. Dad had the majority of his assets in an trust, from which she has held back assets to deal with his estate taxes and real estate issues. His house needs to sell before we can settle the estate. At this point I am wondering if it can just be donated and used to offset taxes, (value is about $60k if it ever sold,) but I am happy enough to let her deal with that. I am pretty much done making discretionary suggestions. Fortunately, I am in no rush.I much appreciate your input, R.IP
Sorry for your loss. Let me commend you for your restraint on suggestions. I've been in the executor's shoes and it can be stressful. Fortunately I had a fairly simple estate to settle and we closed late in the same calendar year as the death. I was lucky.My girlfriend, however, is exectrix for her father's estate and it has split her family. One sister demanded money shortly after his death. Not knowing what all the bills would be, my girlfriend told her she would have to wait. Although she did pay out available cash within a year, that delay, and the fact that his house remains in the estate because his lady companion has the right to live there for life, tore an irrepairable hole in their relationship. To this day that sister won't speak to her and returns all correspondence unopened. Very sad situation.
Very sad situation. It is very sad. Distributions can't be done until all of the issues are handled. Their father had the right to give his companion the life tenancy.
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