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Old 02-09-2018, 08:56 AM   #41
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Originally Posted by ERD50 View Post
Heck, why not sell off half the stocks if nothing else, put them and half the MM in a separate MM until distribution can take place? He also should be able to distribute the majority of it now, and hold back just enough to settle any bills that may come up (how much to hold depends on the clarity of the situation)
This sounds like a good solution, but if BIL keeps his half in equities and the market makes a major downward move, he will probably end up trying to recoup his losses by digging into OP's DW's funds. If the market makes an upward move and incurs tax penalties, same thing. I don't have a solution, other than hoping they can talk some sense into the BIL.

When I was executor of my DM's (very small) estate, I used some online resources to tell me how to handle things. I'm pretty sure one of them suggested immediate sale of all equities in order to simplify taxes. If I can find it I'll post it, but it's been a while. But maybe showing BIL something like that would help. Lots of times someone will react better to uninvolved party advice than to advice from a sibling.
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Old 02-09-2018, 08:59 AM   #42
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OP: I'd like to just draw your attention to my post #12. You don't need SGOTI, you need expertise and, possibly, someone to express your objections to what is happening. A formal letter on legal firm letterhead has the marvelous effect of focusing someone's attention on an issue. And, even if you don't want to fire that artillery, having an advisor in the background will almost certainly benefit you.
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Old 02-09-2018, 09:03 AM   #43
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Thank you for the condolences. This has been really rough for my wife and I to watch her slowly decline and have to fight for her health, safety, and comfort these past few years.

I spoke with the brother (trustee) yesterday and mentioned there may very well be a loss (possibly substantial) in the inheritance before he begins the distribution. His response was the market it great and has only been doing well in the past year unlike the previous 7years.

I wish there was some way to speed up the distribution instead of having to wait on him to do his responsibility. He is the antithesis of "live below your means" and has no knowledge of stock market or investing since he has never saved any money and will now cost his sister because of his arrogance and lack of experience/knowledge.

He is unwilling to consider anyone's suggestions since he thinks the market is going to continue an upward trend in the near future. He must have the crystal ball everyone is looking for. It looks like there is nothing that can be done unless someone here knows of a way around this.

Cheers!
I'm curious, is this is your DW's brother, it that correct? Has your spouse asked you to take on this role. It seems a tad unseemly to be discussing dispersal before the funeral...especially if it's his Mother that died.

It's obvious that you don't think much of the man, but this where permanent family rifts begin. Maybe those bridges have already been burned. It might be he's stubborn and doesn't want to be told what to do and the more you ask the slower he will get.
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Old 02-09-2018, 09:09 AM   #44
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Originally Posted by harley View Post
... I'm pretty sure one of them suggested immediate sale of all equities in order to simplify taxes. If I can find it I'll post it, but it's been a while. But maybe showing BIL something like that would help. Lots of times someone will react better to uninvolved party advice than to advice from a sibling.
I just looked at my NOLO book "Executer's Guide" (5th Edition), chapter 9 is pretty clear. "You have control over someone else's money - and as a result the law imposes a very high standard of behavior on you (the Trustee)". And later "Don't take risks" "Your job is to not lose money". And it goes on to discuss legal action of Trustee is not following this.

And I agree on the separate account issue - no telling if he'd enforce it if it went against him.

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The FA probably canít discuss this account with anyone except the authorized representation, and trying to contact the FA might alienate the BIL.

Asking the BIL to segregate the assets and move one share into an interest bearing account might work. Until the assets are distributed they belong to the trust, so that segregation is not enforceable, but it might help.

Suggesting, or requesting, a partial distribution now is another good idea worth pursuing IMO.
Yes, technically the FA should probably not discuss specifics with you. But that doesn't keep you from mentioning concerns to him. It could be done in 'stealth mode'. Hey, I'm considering keeping my inheritance with your firm, and since I have other money int he market, I'd like to keep this money in very safe low risk investments, recognizing they won't be expected to provide growth.... That might open up something.

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Old 02-09-2018, 09:15 AM   #45
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I'm curious, is this is your DW's brother, it that correct? Has your spouse asked you to take on this role. It seems a tad unseemly to be discussing dispersal before the funeral...especially if it's his Mother that died.

It's obvious that you don't think much of the man, but this where permanent family rifts begin. Maybe those bridges have already been burned. It might be he's stubborn and doesn't want to be told what to do and the more you ask the slower he will get.
Yes, I see it has only been ~ 5 days? With funeral and other issues at hand, it seems a bit early to be too worried about any distributions or moving investments from stocks to MM?

IIRC, you'll need to get an EIN assigned to replace the SSN before the Trustee can do anything. You (OP) might want to settle down a bit here...

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Old 02-09-2018, 12:51 PM   #46
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I'm curious, is this is your DW's brother, it that correct? Has your spouse asked you to take on this role. It seems a tad unseemly to be discussing dispersal before the funeral...especially if it's his Mother that died.

It's obvious that you don't think much of the man, but this where permanent family rifts begin. Maybe those bridges have already been burned. It might be he's stubborn and doesn't want to be told what to do and the more you ask the slower he will get.
I have been the go-between for a few years now for my wife and her brother. The relationship between them deteriorated long ago and there is no love lost. The most that can be said is they are civil during the few times they have to deal with each other. Suffice it to say there have been too many times he has proven to be untrustworthy. Bridges were burned long ago.

I hate to think he might try to be a "day trader" with the inheritance as he has tried to do a few times before.

Thanks for everyone's posts. It looks like this might drag out unnecessarily when my wife just wants it to be over and be done with him.

Cheers!
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Old 02-09-2018, 12:55 PM   #47
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I have been the go-between for a few years now for my wife and her brother. The relationship between them deteriorated long ago and there is no love lost. The most that can be said is they are civil during the few times they have to deal with each other. Suffice it to say there have been too many times he has proven to be untrustworthy. Bridges were burned long ago.

I hate to think he might try to be a "day trader" with the inheritance as he has tried to do a few times before.

Thanks for everyone's posts. It looks like this might drag out unnecessarily when my wife just wants it to be over and be done with him.

Cheers!
Sad how often this seems to happen..this certainly won't improve their relationship...your BIL certainly holds most of the power here
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Old 02-09-2018, 01:42 PM   #48
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Have you considered suggesting that he contact a CPA or an estates attorney to assist him? Acknowledge that it is a big responsibility and that with his Mother's passing it is worthwhile to pay a professional to shephard him through its resolution. Maybe offer to pay a couple hundred if he would do that...
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Old 02-09-2018, 01:50 PM   #49
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IANAL. But it seems to me that if the BIL does not live up to his fiduciary duties as executor, then the OP's DW can petition for either injunctive relief or compensatory damages from the supervising probate court.

In plain language, if the BIL is being an idiot, you can ask the court to either (a) make him stop being an idiot and do the job right, (b) make him pay you back for any idiocy that costs you money, or even (c) remove him as executor and appoint DW as executor.

Any of those actions are likely to make the personal rift worse, so that would have to be given due consideration.
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Old 02-09-2018, 02:06 PM   #50
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... I hate to think he might try to be a "day trader" with the inheritance as he has tried to do a few times before. ....
If there is any realistic chance he might try to gamble with the entire estate, in order to leverage his half, then I agree with the others to get some outside help involved. If he screws up, and it's gone, you won't get blood from a turnip - best to nip this in the bud.

I'd try Brat's soft suggestion first, that he needs help with such a big responsibility, rather than an attack on him. It'll probably cost more than a couple hundred, but it might be worth it, if for nothing else than piece of mind.

And your comments that he thinks the market will keep going up are suspicious - if it was distributed, then he can keep his in the market, so what's the problem? Unless he was just trying to clam you down about doing anything so soon.

Has he applied for an EIN for the trust? You may not be able to do anything at all until that happens.

At a minimum, I would carefully document what would have happened if the estate portfolio was moved to a MM at a specific date that he could have been expected to do it. At least you have a benchmark to argue against if there is a drop.

Is there a reason BIL is POA and Trustee, and not your wife, or the both of them?

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Old 02-09-2018, 03:34 PM   #51
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Sorry for your loss, Badger.

Just because you are designated as the executor doesn't mean you have the authority to immediately liquidate funds or otherwise move money around. Here in WA you have to:

1) Wait for the death certificate to be issued -- in our mom's case that took several days

2) File the will -- that took a couple more weeks in our case because mom neglected to have certain language in it so the lawyers we chose had to petition the court to have it recognized

3) Obtain the letters testimentary that confirm who the executor is -- only after she got THESE could my sister (the executor) close down mom's old accounts and open the estate accounts.

Process is probably different in different states, but in any event I think the expectation that the BIL in this case can make immediate changes to the accounts is a bit presumptuous.

I would personally try to be less involved/worked up about it. Let the process work itself out. Yes, it would have been nice if everything could have been liquidated when the markets were at their peak, but isn't worth the stressing over too much at your net worth levels.
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Old 02-11-2018, 10:04 AM   #52
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Start by making sure that you have complete copies of all will, trust, policies and account documents. Read each carefully.
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Old 02-11-2018, 10:43 AM   #53
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Iím confused why the capital gains rate on $355K be more than 15% (up to $470,700) or at the very most 20% (on $470,700+)?

Can you explain that for me?

Thanks.
CPA told us if estate paid the taxes, it would be almost 40%, where as if we paid individually it would be much less.
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Old 02-11-2018, 02:23 PM   #54
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That doesn't make any sense to me. I'd ask for clarification. And if you get it, please share it.

The value of most items in an estate are set at the value the day the person passed. Stepped up basis for most, so no tax due unless you are over the estate tax minimum or live in an inheritance tax state. The only taxes due for most estates is whatever increase in value occurs between death and sale of the item (stock, bond, house, etc.). At least in my experience.

Edit: For after tax items. IRAs and such you have to pay the tax when the money is withdrawn. No step-up in basis on those.

Edit Edit: I re-read your post. Sounds like it's a done deal, and so I'll probably never know the why on this one. Oh well.
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Old 02-11-2018, 03:19 PM   #55
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Lots of partially right info on this thread. A trustee has a fiduciary duty yes. However, a fiduciary duty does not mean they turn everything to cash the day a person dies. A fiduciary duty means to act reasonably. I always advise turning assets to cash but I would not say it's a clear breach of fiduciary duty to not follow that advice. Also, assets from a trust are usually not (at least if a trustee is getting prudent advice) distributed to the beneficiaries right away. In California, for example, the beneficiaries have 120 days to contest a trust after trust notice is sent out. In my opinion any trustee who distributes before 120 days has expired is being risky. Beyond that we usually see some type of distribution around 6 months and the bulk of the distribution around one year. The money is FIRST to pay all obligations of the decedent. In most cases everybody knows what the obligations are, since elderly people usually have a simple life, so waiting a year is probably not necessary but when I am giving the advice I always recommend waiting the year to be sure all possible claims have been dealt with, all tax compliance work done, etc.... People need to be patient. In my opinion it's quite offensive when the beneficiaries start asking about their money within weeks of a person's death. Just my two cents.
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Old 02-12-2018, 09:40 PM   #56
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...Just my two cents.
Worth more than that -- sounds like you're in that business professionally? It's spot on with what we're going through with my 101-year-old grandmother's death last August. She had about $4MM all in a trust run by a local bank.

It's definitely not a quick process. They said they had to put out ads in area newspapers asking for creditors and wait some period of time for protests or something. They then disbursed about 5% to heirs in the Will about four months later, and told us the rest will probably be disbursed another few months after that.
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Old 02-12-2018, 11:25 PM   #57
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People need to be patient. In my opinion it's quite offensive when the beneficiaries start asking about their money within weeks of a person's death. Just my two cents.
^This^
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