Accurate asset inventory important

Natalia Vander Laan

Natalia Vander Laan

Probate is the process used to settle the estate of the deceased person. The courts monitor the probate process. The type of probate process is determined by the value of the estate. Therefore, it is important to have an accurate inventory of all the estate’s assets.

Inventorying assets serves several important purposes: it allows to identify and locate the decedent’s assets, thus ensuring a comprehensive understanding of the estate’s structure; it allows to precisely assess the value of assets to determine the estate’s worth, to decide on the proper probate proceeding, to properly calculate taxes, and to facilitate the fair distribution of assets; it allows to discover the estate’s financial responsibilities, thus ensuring that the debts are addressed correctly; finally, it allows to conduct a transparent accounting of the decedent’s assets, which is required by law to avoid disputes and comply with legal duties.

A systematic and methodic approach to the inventory can make this difficult task easier and minimize possible mistakes.

Oftentimes, if the estate plan was comprehensively prepared and kept up to date, the estate planning documents such as a will, trust, and property schedule may state specific assets.

The personal representative should begin by gathering all relevant documents evidencing the assets of the estate, such as bank, investment, and retirement statements, promissory notes and judgments, real property deeds as well as mineral and water rights, long-term leases, and deeded time-shares, insurance policies, business records, royalties, intellectual property, personal property, and safe deposit boxes.

The personal representative should create a complete list of assets to ensure that nothing is unintentionally disregarded. It helps to categorize assets by type, such as real property, financial accounts, and personal property.

Next, all assets should be thoroughly reviewed by recording their type, value, location, and description. Personal property may be photographed. Oftentimes, professional appraisers need to be retained to conduct an accurate valuation, especially of real property or business assets.

Personal Representative should note and inventory any outstanding debts, mortgages, loans, or tax obligations associated with the estate. All creditors’ information should be complied for debt settlement purposes.

The personal representative should engage licensed and qualified professionals to appraise assets accurately such as date-of-death and current fair market value appraisals for real estate, investment portfolios, and valuable personal property.

The personal representative should maintain detailed records of their activities. All inventory documents and activities should be documented accurately, including dates, sources of information, and valuation methods.

Inventorying assets is a critical aspect of the probate proceeding, and the personal representative should be aware of those challenges and complexities such as hidden or difficult to locate assets, disputed valuations, and diverse assets across multiple jurisdictions.

Inventorying assets in probate is a vital process that ensures the orderly administration of an estate and the fair distribution of assets.


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