What happens when one of the heirs has no money to settle the estate?

Get Legal Help Today

 Secured with SHA-256 Encryption

What happens when one of the heirs has no money to settle the estate?

My mother passed away in December. My sister and I both received $35,000 in life insurance and joint ownership of her house which is paid off. We were each told to set aside $5,000 each to settle her estate. It is now time to do so and we owe $10,000 in inheritance tax and credit cards. My sister doesn’t have a dollar to her name so I have to foot the whole bill. Does this mean that she forfeits ownership of the house? What are my options?

Asked on August 14, 2010 under Estate Planning, Pennsylvania

Answers:

M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

I am sorry for your loss.  No, it does not mean that she forfeits the house, which I am sure is worth for than $5,000.   What you can do depends on how you are proceeding through this matter with the house, etc.  I would seek help from an attorney.  Are you intending on selling the property?  You could do so to pay the debt of $10,000 and not put in the $5,000 each. Or you could pay the whole amount and you could enter in to a separate agreement where your sister acknowledges the debt you have paid on her behalf and she agrees to give you $5,000 from her share in the sale of the house; you could enter in to a loan agreement; you could have her execute a note and file it as against the house once it has transferred ownership.  It really all depends on "what comes next."  Seek help.  Good luck.


IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

Get Legal Help Today

Find the right lawyer for your legal issue.

 Secured with SHA-256 Encryption