Legal requirement to execute a will?

[TH3FRB]

My father recently passed away. I am the executor and sole beneficiary of his will. His estate likely has a net negative value due to an upside-down mortgage on one house and a $285K HELOC debt on another house. There are a handfull of other minor bills as well. The only bank account with a significant balance was jointly held with me and I am the designated beneficiary of his IRA.

I was under the impression that I had a legal requirement to open the estate and go through the probate process. Given that I have nothing to gain from the estate, it would be much easier to simply let the creditors file for forclosure on the properties and just ignore the unsecured debts. Am I under any legal obligation as the executor of the will to do anything? I have been notifying all the creditors and will provide death certificates as requested.

 

[TH3FRB]

Okay - I'm slowly educating myself. Seems I'm not technically the executor until appointed by the court and that doesn't happen unless I open the estate. So at this point I'm not legally obliated to do anything...correct?

 

[tranquility]

Some states require the possessor of a will to file it within so many days after the death of the writer.

 

[anteater]

You really should keep all posts dealing with one situation in the original thread.

In your other thread, you brought up the issue of domicile - PA or FL.

There is a very real practical consideration to a technical question here - the PA Inheritance Tax.

If your father is considered to have been a PA resident, the IRA unless he was less than 59-1/2) and at least 1/2 of the bank account will be subject to PA Inheritance Tax. Not going go through asset by asset, but here is a summary version of what is subject to the tax. (Mortgages and debts are deductible from assets, so exactly what might be owed is really up in the air when you consider the gross estate.)

All real property and all tangible personal property of a resident decedent, including but not limited to cash, automobiles, furniture, antiques, jewelry, etc., located in Pennsylvania at the time of the decedent's death is taxable. All intangible property of a resident decedent, including stocks, bonds, bank accounts, closely held business interests, loans receivable, etc., is also taxable regardless of where it is located at the time of the decedent's death.

In the case of a non-resident decedent, all real property and tangible personal property located in Pennsylvania at the time of the decedent's death is taxable. Intangible personal property of a non-resident is not taxable.

Jointly-owned property with right of survivorship, except between husband and wife, including but not limited to real estate, securities, bank accounts, etc., is taxable to the extent of the decedent's fractional interest in the joint property (calculated by dividing the value of the joint property by the number of joint owners at the time of the decedent's death). Joint property is taxable even though the decedent's name was added as a matter of convenience. Further, if the decedent created the joint interest in the property within a year of his/her death, the full value of the property is taxable in the decedent's estate.

 

[TH3FRB]

Thanks for the reply. I started a new thread in a different forum because it is a different (but obviously related) topic. Anyway, good point about the PA inheritance tax. Who gets to make the call on what state he was actually a resident of? He had been living full-time in FL for at least a year prior to his passing. He just never changed his license or auto registrations from PA. Seems I have a reasonable argument for him being a Florida resident and avoiding the PA inheritance tax.

 

[anteater]

You are into an area where evidence of intent is usually determinative. And, so far, most of what you have said does not show intent to be a Florida resident. Does his will make any statements about him being a resident of PA?

Is there anything that indicates his intention to be a Florida resident?

If you want to see the factors that the PA Department of Revenue would consider:

http://www.revenue.state.pa.us/portal/server.pt/document/628225/rev-1737-1_pdf

Other documents regarding non-resident inheritance tax can be found at (rev-1736 and rev-1737):

http://www.revenue.state.pa.us/portal/server.pt/community/inheritance_tax/14695

 

[TH3FRB]

Actually - his death certificates lists him as a PA resident - I knew that. Guess I might be kissing that 4.5% good-bye.

 

[anteater]

Actually - his death certificates lists him as a PA resident - I knew that. Guess I might be kissing that 4.5% good-bye.

Not trying to be insensitive... But it is not like he told whoever completes the certificate in Colorado that he considered himself a PA resident.

Still, there is not much to go on to support a contention that he considered himself to be a Florida resident.

I forget what you said about the values and debts associated with the real property. But, if the negative equity is great enough, it could offset the value of the IRA and the joint account, resulting in no PA Inheritance Tax liability.