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Can a decedent will property he only owned indirectly?

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T

TeacherDave

Guest
California:

My late father owned 9 out of 10 shares of a corporation. The corporation owned a house. The will ordered two things: that the corporation be liquidated, and that the the Estate's 90% of the house go to the beneficiaries of the will.

The corporation sold the house with the probate court's blessing in order to raise the money needed to pay the corporate taxes due on dissolution.

After that the money that passed to the Estate was considerably less than the (90% of) sales proceeds received for the house.

QUESTION: Should the executors take as the value of the house

1)what was left after corporate taxes were paid, or

2)what the house was sold for, or

3)argue that there was no gift since my father didn't actually own the house but only 9 shares of the corporation that owned it, and therefore he had no right to give it at all.
 


A

advisor10

Guest
1-2-2002

DEAR TEACHERDAVE:

The most logical option would be option #1, since a distribution can only consist of the net proceeds from the sale of the house.
 

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