[WSBAPT] Estate with creditor claims but exempt assets

[Eric Nelsen]

Thanks Mark--That's my thinking as well, as to retirement accounts in name of the decedent. Exempt during life, still exempt during death. I did neglect to mention, though, that they're not non-probate assets because they didn't list a beneficiary--they were payable to the estate.

Then, as to the surviving spouse's retirement account, that's neither probate nor non-probate--there's no pay out due because they are triggered by death of the survivor. But decedent had a one-half CP interest in them. But it seems to me, if the account was exempt from attachment during life, then the death of one spouse shouldn't make half of the survivor's retirement account suddenly accessible to creditors.

Sincerely,

Eric

Eric C. Nelsen
SAYRE LAW OFFICES, PLLC
1417 31st Ave South
Seattle WA  98144-3909
phone 206-625-0092
fax 206-625-9040

Please Note that We Have Moved. We have moved our Seattle office to Mount Baker Ridge (a small commercial community just above the I-90 tunnel). Our new address is 1417 31st Avenue South, Seattle WA 98144. All other contact information remains the same.

From: wsbapt-bounces at lists.wsbarppt.com [mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of Mark Vohr
Sent: Tuesday, November 15, 2016 3:05 PM
To: WSBA Probate & Trust Listserv
Subject: Re: [WSBAPT] Estate with creditor claims but exempt assets

Eric - I'll take a shot at this.

                Estate creditors cannot get to those assets.  Most would be non-probate assets, but are not accessible to creditors as non-probate assets.  See RCW 11.02.005 for definition of non-probate assets.  Basically, the way to look at it is that if the creditor couldn't get to the asset during life, the creditor can't get to the asset at death.  See also, RCW 48.18.410 which protects life insurance proceeds from creditors of the estate if there is a named beneficiary.

                Since the whole of separate and community property is administered as part of the estate, the same reasoning should apply to the surviving spouse.  Make sure to provide notice to these creditors to cut off claims.  If the creditor can otherwise go after the surviving spouse, then the spouse may have to pay.  However, retirement assets in the name of the spouse should be protected just as they are in the name of the decedent.



Mark



Ohana Fiduciary Corp.
Ohana Financial Services

Mark C. Vohr, J.D., CPG, Principal
PO Box 33710  Seattle, WA  98133
T:  (206) 782-1189 F:  (206) 782-1434
mcv at ohanafc.com<mailto:mcv at ohanafc.com>      www.ohanafc.com<http://www.ohanafc.com/>




From: wsbapt-bounces at lists.wsbarppt.com<mailto:wsbapt-bounces at lists.wsbarppt.com> [mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of Eric Nelsen
Sent: Tuesday, November 15, 2016 2:42 PM
To: WSBA Probate & Trust listserve (wsbapt at lists.wsbarppt.com<mailto:wsbapt at lists.wsbarppt.com>) <wsbapt at lists.wsbarppt.com<mailto:wsbapt at lists.wsbarppt.com>>
Subject: [WSBAPT] Estate with creditor claims but exempt assets

If an Estate has $50,000 in creditor claims but its only available assets are retirement accounts exempt from seizure under RCW 6.15.020<https://urldefense.proofpoint.com/v2/url?u=http-3A__app.leg.wa.gov_RCW_default.aspx-3Fcite-3D6.15-26full-3Dtrue-236.15.020&d=DQMFAg&c=euGZstcaTDllvimEN8b7jXrwqOf-v5A_CdpgnVfiiMM&r=K1mLMC1eFjwfeeMM-AC6zQ&m=DY5JIujnt46cGhiAK_E3h9Dl9-oXw9mQ7SPNllWqa8o&s=jzVWA6bWFq-87sYh_IgNbUah0AxU9GkNBZ-vDzzjspM&e=>, does that also exempt the Estate from paying the creditor claims?

The statute says:

The right of a person to a pension, annuity, or retirement allowance or disability allowance, or death benefits, or any optional benefit, or any other right accrued or accruing to any citizen of the state of Washington under any employee benefit plan, and any fund created by such a plan or arrangement, shall be exempt from execution, attachment, garnishment, or seizure by or under any legal process whatever.

Does that include a creditor claim process in an estate?

Additional wrinkle, bonus points: The retirement account is actually accrued by and in name of the surviving spouse -- community property. Same result?

Can the surviving spouse be forced to pay a debt, via a creditor claim process, with assets that couldn't be attacked by attachment or garnishment?

Sincerely,

Eric

Eric C. Nelsen
SAYRE LAW OFFICES, PLLC
1417 31st Ave South
Seattle WA  98144-3909
phone 206-625-0092
fax 206-625-9040

Please Note that We Have Moved. We have moved our Seattle office to Mount Baker Ridge (a small commercial community just above the I-90 tunnel). Our new address is 1417 31st Avenue South, Seattle WA 98144. All other contact information remains the same.

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