Probate is the process of settling a person’s estate, generally using their estate plan to do things like taking an inventory of the assets, sending out copies of the will, and then distributing those assets in accordance with the estate planning documents. When enough planning is done in advance, this process can often go very smoothly.
However, the estate may still owe certain debts. Perhaps a parent passed away before paying taxes at the end of the year, such as property taxes or income taxes. Or maybe they passed away unexpectedly, so they still have a home mortgage, credit card debt and things of this nature. Naturally, there are also often issues with medical debt if someone who passed away was receiving medical care previously.
The estate covers the debt
The estate executor is the one who is tasked with paying off the debt. Some executors worry that this means they are going to lose their personal funds. They suddenly have inherited a parent’s mortgage or tax liability.
But this isn’t how it works. Instead, the executor just uses the funds that are already within the estate to pay off these debts. This can lower the total value of the estate, so other beneficiaries may not get as much money as they expected. But it doesn’t mean that the estate executor has to take their personal funds and pay off someone else’s debt.
Your legal options
Are you going through probate with your family and running into complications like these? Be sure you know exactly what legal options you have at this time.