In the area of estate planning, when someone dies, he or she is called a decedent. These decedents almost always leave behind an estate. An estate consists of the property the decedent owned at their death, with the exception of property that is held in joint ownership or that passes via non-probate transfer, such as life insurance benefits. Every estate of a decedent then falls into one of two categories: solvent or insolvent. How are the two different?
A solvent estate is one with enough assets to cover any outstanding debts owed and still have enough left over for the decedent?s heirs. This type of estate is not really a problem. An insolvent estate, however, does pose a problem.
An insolvent estate poses a problem because there are not enough assets to go around, meaning that someone ? usually the heirs ? isn?t going to get what they were promised.
If an estate is determined to be insolvent, the administrator of the estate needs to start selling off assets so that the creditors may receive at least a portion of the amount owed. Thus, depending on the depth of insolvency, the heirs may receive nothing, or just a fraction of what was bequeathed.
Byrd : Garrett, PLLC is a member of the American Academy of Estate Planning Attorneys.
Source: http://www.byrdgarrett.com/blog/estate-planning/insolvent-estate/
the lake house petrino arkansas roy williams matt lauer divine mercy chaplet albert pujols the shining
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.