[WSBAPT] off topic

Sat Jun 17 08:50:56 PDT 2023

Dear colleagues,

I apologize for duplicate posting.

After a house fire, when working with the homeowner’s insurance, would it
advisable do you think for the home owner to hire her own investigator to
evaluate the loss?  I may be a cynic but I think it’s against the insurance
company’s interest to pay the maximum available.  In this case, all those
decades of priceless possessions, and the home, which Zillow listed at
$4mil the day before, are a total loss.  If you would advise an independent
investigator, can anyone make a recommendation?

FYI, the home owner, who turns 90 this week, was home when the fire broke
out.  After 24 hours in the hospital she was released and is home with one
of her sons.  If there is a bright side, it brought her four boys together
for the first time since the pandemic.  They raked through the muck to see
what could be salvaged.  She is stoic and is already thinking about buying
a smaller home.

Take aways: Video record ALL of your possessions.  Have a fire extinguisher
handy to every room.  And GET OUT.

Marsha

*Marsha C. Hudson*
(She/Her/Hers)

Attorney at Law #23330

3221 NW 62nd Street, Seattle, WA  98107

Telephone: 206-297-3933

Fax: 206-357-9356
marsha at griffyn.us

*Life's most persistent and urgent question is: What are you doing for
others? -* Martin Luther King, Jr.

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*From:* wsbapt-bounces at lists.wsbarppt.com [mailto:
wsbapt-bounces at lists.wsbarppt.com] *On Behalf Of *Doehne, Jen
*Sent:* Friday, May 5, 2023 2:24 PM
*To:* WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com>
*Subject:* Re: [WSBAPT] Estate Tax Question

Hi Inge,

It’s important to differentiate the different types of taxes: income for
the estate, real estate excise for the sale/transfer of real property, and
excise for the estate.

àIf the PR is transferring the property to a beneficiary (no sale), there
would be no real estate excise transfer tax.

àIf the PR is transferring the property to a beneficiary (no sale), if
there is an income tax return required to be filed (1041), it would be
because other assets earned over $600 in the calendar or fiscal year after
death…but the transfer of the property would not lead to this decision.

àIf the total estate of the decedent consisted of over $2,193,000 in
assets, there would be a Washington Estate (excise) Tax return filing
required.  When calculating the total value of the estate, you would use
the date of death value of assets and yes, this value would include the
value of the house.

The three taxes above would apply regardless of whether there was a probate
opened or not -think of probate as asking the court’s permission to
transfer the assets. The only impact on a probate is to consider if any
taxes are required to be filed, the probate will likely need to stay open
for the conclusion of those filing (perhaps even the receipt of the
satisfaction from the Department of Revenue if an estate tax (excise)
return is required).  Your Declaration of Completion of Probate would
reference that there are no estate taxes outstanding as of the date of
closing probate.

The EIN would be required if 1. The real property is sold and the proceeds
must be distributed into an estate bank account (the bank account would
require the EIN to be opened) OR 2. The estate earned over $600 in income
and form 1041 is required to be filed.  The Washington estate (excise) tax
return does not require an EIN to be filed.

Regarding the mortgage – was the transfer of real property a specific
bequest to your client?  If so, your client must take the property along
with all attachments. Therefore it was her responsibility to either assume
or pay the mortgage anyway. (You mention that “the property is in her name
now”.) If the bequest was part of the residue, that makes it a bit tougher
because it sounds like there are no other assets to be reimbursed from. If
she was the sole beneficiary, my answer is the same. If there were other
beneficiaries, how did your client end up with 100% of the property?  If
she is jointly owning the property with other beneficiaries, I would argue
that the other owners should reimburse her to their proportion of
ownership.  Have they stated they will not do so?

I am not sure where the EIN comes into the conversation here….but it would
depend on your answers above.

Should you need to apply for an EIN, personally, I would choose the last of
the two to die and apply for only one. However, it has been awhile since I
have administered a joint estate, someone else may have to advise on this
question.

Best,

Jen

Jen Doehne, Attorney
Pronouns she/her/hers

909 A Street, Suite 600 | Tacoma, WA 98402
phone 253.572.4500 | fax 253.272.5732 | www.eisenhowerlaw.com

*From:* wsbapt-bounces at lists.wsbarppt.com <wsbapt-bounces at lists.wsbarppt.com>
*On Behalf Of *Inge Fordham
*Sent:* Friday, May 5, 2023 1:54 PM
*To:* WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com>
*Subject:* [WSBAPT] Estate Tax Question

Estate tax gurus,

I have a client who opened probate for the sole purpose of executing a PR
deed to transfer real property.  The estate has no other assets.  She has
not obtained an EIN or opened an estate bank account.  Does she need to
file an estate tax return?

Second question – My client paid off the mortgage with her personal funds.
The mortgage company will not issue a check refunding the balance of the
escrow account to my client, personally (even though the property is in her
name now).  We can ask the mortgage company to issue the check to the
estate.  This is a joint estate (for Grandma and Grandpa).  Would I just
obtain an EIN for the last grandparent to pass?  (The IRS won’t allow me to
input information for two decedents, even though their estates are being
probated as a joint estate).  I’m concerned the mortgage company will want
to write a check to “Estates of Grandpa and Grandma.”  Do banks object to
opening an estate account in joint probate scenarios (with names of two
decedents)?

Thanks in advance!

[image:
uc%3fexport=download&id=1W3rEcChy0_E0cCfV5up02mkhwnL6eWIs&revid=0B4P5JoIHdbFaR29EbHlRWHFseFV5STZpSUVGeUNPWldkVDFVPQ]

*Inge A. Fordham | Attorney*

Fordham Law, PLLC

3218 Sixth Avenue | Tacoma, WA 98406

Office: (253) 348-2657 | Mobile: (206) 778-3131

www.fordhamlegal.com

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