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Inheritance of property split 4 ways but only two are executors to sell property

Forum|Forum|5 years ago
January 25, 2021
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My wife’s brother passed away September 1, 2019. There are 4 surviving siblings. My wife and her older brother were listed as executors of his estate. The value of his estate was under $130,000. The only thing of value was the land (trailer park) his trailer was on. It was a 1966 Crestwood model, but he owned the land it was on. The trailer and land was paid off. We had to hire an attorney for probate. We had to pay his property taxes, Home Owner Association (HOA) dues, utilities, and other debuts. We did contact all of the businesses/banks he owed. Some wrote off his debt with proof using the Death Certified, but others did not. Since he did not have anyone on his bank account as beneficiary, we could not access his account which only had $1,800 in it. He was not married and had no children. The court took 7 months for the court to complete the transfer of property to my wife and older brother. When we sold the trailer/land, the net profit of the home (not counting the probate, paying off his bills and taxes) was $113,352.64; sold in 2020. This amount is from the escrow balance sheets for proceeds to seller statement. Paying his debts we netted $94,038.72. In his will, he stated the monies to be divided 4 ways equally between the 4 surviving siblings. However, the escrow was only in two names, the older brother and my wife.

My questions:

Are my brother-in-law and wife (executors) responsible for claiming $94,038 ($137,532 ?), or is it split 4 ways (approx. $22, 500 each)?
If my deceased brother in law originally bought the trailer and land for $30,000, does that bring the tax base down $30, 000?

Thank you in advance.

Not A Product Question

Best answer by M-MTax

Split 4 ways because it's in the will. Whatever your wife's brother owned is stepped up to its fair market value on the date of his death....so not what he paid for it but the FMV which should be a lot higher than $30k.

M-MTaxAnswer

Split 4 ways because it's in the will. Whatever your wife's brother owned is stepped up to its fair market value on the date of his death....so not what he paid for it but the FMV which should be a lot higher than $30k.

D

DijoAuthor

Thank you, and yes split 4 ways per the will. We sold at fair market value, $113,532. In fact some units in the park sold for less money. I guess my question is can we subtract the $30,000 he paid for it; which leave us with $83,038 in gains instead of the $113,582?

M-MTax

@Dijo You don't use the $30k he paid for it as your basis....you use the fair market value on the date of his death so you might not have much if any gain.