Do life insurance proceedshave to be declared inan estate settlement?
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Do life insurance proceedshave to be declared inan estate settlement?
Brother dies leaves 2 sisters and 1 brother; no was other family; he had no Will. Life insurance policy named the brother as sole beneficiary The 2 sisters are not speaking to the brother who received the money. 1 is the executor to the estate. NY attorney has threatened that if he does not disclose the life insurance money the estate will be settled without his knowledge and his portion of the estate will be “frozen”. He has not received any other information regarding the selling of estate assets, etc. The only time the attorney calls is to get the details regarding the life insurance. Can the attorney settle the estate if all 3 siblings are not in agreement?
Asked on August 29, 2011 Massachusetts
Answers:
FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
By Internal Revenue Service regulations life insurance proceeds of a decedent that names a beneficiary under it other than the decedent or his/her trust or will is not an asset that is to be included in the decedent's estate. If your deceased brother's life insurance policy named another brother that survived him as the beneficiary, the surviving brother receives the life insurance proceeds as his own to the exclusion of all others.
From what you have written, there is an administration filed to close your brother's estate filed in the superior court of a given county in New York. The administrator of the estate has to make sure that all beneficiaries must be given notice of all proceedings concerning the estate's administration and needs to file a final proposed distribution of the assets for approval by the court via an order.
The attorney can make the motion to settle the estate even if all the estate's beneficiaries are not in agreement as long as this is what the administrator desires. The court will make the final decision as to whether of not to approve the request for final distribution.
Good luck.
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