[WSBAPT] Estate Distribution Issue re: Excise Tax

[Diane J. Kiepe]

Oh these circular calculations are crazy aren’t that.  One thought is to just make it a buyers expense and let him pay if he is willing (not sure of the difference in his share and what he will pay).  If I think of anything else, I’ll share it.  Still on one cup of coffee 😉


Diane J. Kiepe
Douglas Eden, P.S.
717 W. Sprague Ave., Suite 1500
Spokane, WA  99201
djkiepe at depdslaw.com<mailto:djkiepe at depdslaw.com>
509-455-5300

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From: wsbapt-bounces at lists.wsbarppt.com <wsbapt-bounces at lists.wsbarppt.com> On Behalf Of Jane Bitz
Sent: Friday, January 26, 2024 4:00 PM
To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com>
Subject: [WSBAPT] Estate Distribution Issue re: Excise Tax

Hi All:

I have an estate where a beneficiary is going to receive a parcel of real estate that exceeds his share of the estate. He is going to pay the difference between his inherited share and the price of property. My issue is that when we calculate the Excise Tax (calculated on the amount paid, not the property value) and include it as an estate expense (seller’s cost), it decreases the beneficiary’s share that will be distributed, so it increases the amount he has to pay in to the estate and thus, increases the amount of the excise tax payable.

Is there any simple way to “fix” this issue? I have considered just having him pay “more” than is required to equalize the distribution and then rebate any extra in the estate back to him. This means he is “paying” more than he has to for equalization and the estate is paying more in excise tax on the transaction.

Wondering if anyone else has run into this particular issue?
Thanks.
Jane.

Jane Bitz
Of Counsel
Helping Good People do Great Things!
12209 E. Mission Ave., Suite 5
Spokane Valley, WA 99206
(509) 927-9700 (Phone)
www.whc-attorneys.com<http://www.wolffandhislop.com/>

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