3 Reasons It Takes So Long to Receive an Inheritance

Usually the first thing that the beneficiary of an estate or trust asks is when they can expect to get their inheritance check. Unfortunately sending out the inheritance checks is the very last item on the “to do” list of the personal representative or trustee.  Why?  Because the personal representative or trustee has to fulfill all of the duties and responsibilities that are required for settling an estate or trust before handing the assets over to the beneficiaries.  Otherwise,the personal representative or trustee can be held personally liable for any unpaid bills and taxes.

Even with a simple estate or trust, the duties and responsibilities of the personal representative or trustee can be tedious and will delay the final distribution of the assets.  What can be so time-consuming about settling an estate or trust that will cause the plans you have for your inheritance to be put on hold?  Consider the following:

  1. Probate takes time and money. Probate is necessary when a deceased person leaves behind assets that are titled solely in the individual’s name without any beneficiary designated.  This is true even if the deceased person created a revocable living trust provided that the trust was not fully funded at the time of death.  Probate is a state court process that takes time and money and will delay the delivery of your inheritance check.
  2. Tax returns have to be filed and taxes have to be paid.  The personal representative or trustee is responsible for filing the deceased person’s final income tax return(s) and paying any taxes that are due.  Aside from this, the estate or trust may owe state estate taxes or inheritance taxes or federal estate taxes, in which case these returns must be filed and these taxes must be paid.  Finalizing tax returns and paying any taxes due will delay the delivery of your inheritance check.
  3. Beneficiaries have their own agenda. Even though the beneficiaries of an estate or trust usually want to get their inheritance checks in their hands as soon as possible, they don’t always act quickly or follow instructions.  Inevitably there will be at least one beneficiary who drags their feet when asked to provide information or sign and return legal documents or who will skip a signature and require documents to be resent.  One disengaged beneficiary will spoil it for the rest and delay the delivery of your inheritance check.

For additional information about why settling an estate or trust takes so long and what to do with your inheritance, refer to the following:

Photo: © MCA Records

Advertisements

3 Tips for Making Your Estate Plan Your Decision

Many people struggle with all of the decisions that they have to make when putting together their estate plan: Who should get what? When should they get it? Who shouldn’t get anything? Who should be the executor? Who should be the trustee?

All of these decisions can be overwhelming, even for someone who has what is considered a “normal” family, but they don’t have to be.  In the wise words of Jerry Cantrell of Alice in Chains, it’s your decision.

If you’re stressed out about how to plan your estate, then don’t despair.  Here are three tips for making your estate plan your way:

Tip #1 – Don’t be afraid to disinherit someone. It’s your money, so you can choose to leave it, or not leave it, to whomever you want. But beware – being bullied into making your estate plan a certain way by a certain individual and not the way you really want it (for instance, leaving everything to one child to the exclusion of others at the insistence of that one child) will result in family discord.  If you really want to disinherit someone, then that’s your prerogative, but if someone bullies you into disinheriting someone else, then in extreme cases this could amount to “undue influence” and lead to an ugly will or trust contest. If you truly want to disinherit someone, then work closely with your estate planning attorney to insure that not only will your final wishes be carried out, but your plan will be bullet proof from challenges.

Tip #2 – Choose your executor and trustee wisely. Here are the traits you should look for in your executor and trustee:  loyal, fair, practical, trustworthy, organized and tough.  If you choose a person who has most of these traits, then your final wishes will be fulfilled, but if you choose a person who has only one or two of these traits, then your final wishes will take a back seat to their own agenda.  Better yet, choose a corporate trustee, such as a bank or trust company, to put these important jobs in the hands of professionals.  Otherwise it may be way too easy for Uncle Bob to skim some off of the top or for your loved ones to convince Uncle Bob to disregard your wishes.

Tip #3 – Listen to your estate planning attorney.   While a good estate planning attorney will listen intently so that he or she can learn about your greatest concerns and challenges when it comes to planning your estate, you should also listen to your estate planning attorney because he or she can offer some good advice and solutions to ease those concerns and overcome the challenges. And while sometimes what your estate planning attorney says may not be what you want to hear, your attorney’s advice, which comes from years of experience in similar situations, may very well head off a family feud or a will or trust contest.