Re
roperty Not Listed In Inventory
What is the name of your state? Texas
In this post, I describe a situation that I am contending with, and am having a difficult time understanding clearly. Because most of us don't have an accounting background, it may be little confusing and difficult to folllow. But I hope that some may understand my problem and provide some answers that will help me to decide what I can do to correct this problem for me and my family.
This concerns a probate of my aunt's estate. It shouldn't have been very difficult to settle, but here is what has happened.
First of all, the Inventory was complete, and contained the real estate valuations when the Inventory was submitted to the Probate Court by the estate Administrator. These valuations of real estate, just like the valuations of the personal property/assets also reported in the Inventory, are the starting valuations of the total estate that the Administrator must use as the estate basis valuation that he is going to adminster and be accountable for to both the Probate Court and the estate heirs.
About a year after submitting the Inventory, the First Accounting of the estate was provided by the Administrator. The Administrator's First Accounting, Schedule A, starting basis for the total estate valuation should have been the personal asset valuation and the real estate valuation as reported in the Inventory described above. However, that was not the case. The Inventory cost basis valuation of the real estate was not included in the beginning First Accounting Total Estate accountable valuation. During the First Accounting reporting period, the Administrator added all receipts of the estate, and subtracted all expenses of the estate, to this beginning balance, and ended up with a remaining balance of the Estate. In other words for this First Accounting, FIRST ACCOUNTING TOTAL ESTATE BEGINNING VALUE + ALL RECEIPTS - ALL EXPENSES = FIRST ACCOUNTING TOTAL ESTATE ENDING VALUE.
A year later, a Second Accounting is prepared by the Administrator, and submitted to the Probate Court. The beginning value of this Second Accounting was the "FIRST ACCOUNTING TOTAL ESTATE ENDING VALUE" as explained above. And the FIRST ACCOUNTING TOTAL ESTATE ENDING VALUE + ALL RECEIPTS - ALL EXPENSES = SECOND ACCOUNTING TOTAL ESTATE ENDING VALUE. Still there was not any recognition of the real estate cost basis valuations that were identified three years earlier by the Administrator in the Initial Estate Inventory.
The following year, the Third and Final Accounting was prepared by the Administrator, and submitted to the Probate Court. The beginning value of this Third and Final Accounting was the "SECOND ACCOUNTING TOTAL ESTATE ENDING VALUE" as explained above. And the SECOND ACCOUNTING TOTAL ESTATE ENDING VALUE + ALL RECEIPTS - ALL EXPENSES = THIRD AND FINAL ACCOUNTING TOTAL ESTATE ENDING VALUE = 0. Everything appeares to have been distributed from the Estate, leaving a "0" balance. Still there was not any recognition of the real estate cost basis valuations that were identified four years earlier by the Administrator in the Initial Estate Inventory. This real estate valuation would have been considered the cost basis of the real estate when determining any profit or loss from the sale of the real estate, ie, selling price - cost basis = profit, or loss.
The Administrator had sold the real estate during the end of the Third and Final Accounting period, and interestingly, only showed the profit on the real estate sale as a receipt to the Estate in his Third and Final Accounting, and showed the income taxes that were paid on the profit made, the Administrator still did not include the cost basis of the Real Estate. If the Administrator had included the total of the proceeds of the real estate sale, net of selling expenses,ie, cost basis + Profit, as a receipt to the estate in the Third and Final Accounting, then everything would have been properly accounted for. However, the Administrator only included the receipt of the Profit from the sale. It appears as though he assumed that he had properly included the cost basis of the real estate in the beginning First Accounting valuations three years earlier. As I've shown and repeatedly indicated, he did not include the initial real estate cost basis.
So after presenting the Third and Final Accounting to the Probate Court, it shows a "0" balance in the estate, and the prior accountings appear correct, so the Probate Court approved the Third and Final Accounting and acted on the Administrator's petition to be discharged as Estate Administrator.
But where's the money that represents the real estate cost basis? It has never been accounted for except in the Administrtor's Inventory of the estate assets that he filed with the Probate Court four years ago, a year before the First Accounting report.What is the name of your state?What is the name of your state?
roperty Not Listed In InventoryWhat is the name of your state? Texas
In this post, I describe a situation that I am contending with, and am having a difficult time understanding clearly. Because most of us don't have an accounting background, it may be little confusing and difficult to folllow. But I hope that some may understand my problem and provide some answers that will help me to decide what I can do to correct this problem for me and my family.
This concerns a probate of my aunt's estate. It shouldn't have been very difficult to settle, but here is what has happened.
First of all, the Inventory was complete, and contained the real estate valuations when the Inventory was submitted to the Probate Court by the estate Administrator. These valuations of real estate, just like the valuations of the personal property/assets also reported in the Inventory, are the starting valuations of the total estate that the Administrator must use as the estate basis valuation that he is going to adminster and be accountable for to both the Probate Court and the estate heirs.
About a year after submitting the Inventory, the First Accounting of the estate was provided by the Administrator. The Administrator's First Accounting, Schedule A, starting basis for the total estate valuation should have been the personal asset valuation and the real estate valuation as reported in the Inventory described above. However, that was not the case. The Inventory cost basis valuation of the real estate was not included in the beginning First Accounting Total Estate accountable valuation. During the First Accounting reporting period, the Administrator added all receipts of the estate, and subtracted all expenses of the estate, to this beginning balance, and ended up with a remaining balance of the Estate. In other words for this First Accounting, FIRST ACCOUNTING TOTAL ESTATE BEGINNING VALUE + ALL RECEIPTS - ALL EXPENSES = FIRST ACCOUNTING TOTAL ESTATE ENDING VALUE.
A year later, a Second Accounting is prepared by the Administrator, and submitted to the Probate Court. The beginning value of this Second Accounting was the "FIRST ACCOUNTING TOTAL ESTATE ENDING VALUE" as explained above. And the FIRST ACCOUNTING TOTAL ESTATE ENDING VALUE + ALL RECEIPTS - ALL EXPENSES = SECOND ACCOUNTING TOTAL ESTATE ENDING VALUE. Still there was not any recognition of the real estate cost basis valuations that were identified three years earlier by the Administrator in the Initial Estate Inventory.
The following year, the Third and Final Accounting was prepared by the Administrator, and submitted to the Probate Court. The beginning value of this Third and Final Accounting was the "SECOND ACCOUNTING TOTAL ESTATE ENDING VALUE" as explained above. And the SECOND ACCOUNTING TOTAL ESTATE ENDING VALUE + ALL RECEIPTS - ALL EXPENSES = THIRD AND FINAL ACCOUNTING TOTAL ESTATE ENDING VALUE = 0. Everything appeares to have been distributed from the Estate, leaving a "0" balance. Still there was not any recognition of the real estate cost basis valuations that were identified four years earlier by the Administrator in the Initial Estate Inventory. This real estate valuation would have been considered the cost basis of the real estate when determining any profit or loss from the sale of the real estate, ie, selling price - cost basis = profit, or loss.
The Administrator had sold the real estate during the end of the Third and Final Accounting period, and interestingly, only showed the profit on the real estate sale as a receipt to the Estate in his Third and Final Accounting, and showed the income taxes that were paid on the profit made, the Administrator still did not include the cost basis of the Real Estate. If the Administrator had included the total of the proceeds of the real estate sale, net of selling expenses,ie, cost basis + Profit, as a receipt to the estate in the Third and Final Accounting, then everything would have been properly accounted for. However, the Administrator only included the receipt of the Profit from the sale. It appears as though he assumed that he had properly included the cost basis of the real estate in the beginning First Accounting valuations three years earlier. As I've shown and repeatedly indicated, he did not include the initial real estate cost basis.
So after presenting the Third and Final Accounting to the Probate Court, it shows a "0" balance in the estate, and the prior accountings appear correct, so the Probate Court approved the Third and Final Accounting and acted on the Administrator's petition to be discharged as Estate Administrator.
But where's the money that represents the real estate cost basis? It has never been accounted for except in the Administrtor's Inventory of the estate assets that he filed with the Probate Court four years ago, a year before the First Accounting report.What is the name of your state?What is the name of your state?