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Old 08-21-2021, 04:24 PM   #21
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I missed a few of the latest comments.
Others are suggesting the same.

He needs to make a decision, but you will have to force his hand.
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Old 08-21-2021, 04:26 PM   #22
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You need a good trusts & estates attorney. He will advise you on what your options are. One MAY be to go to court and ask that the trust language be overridden because your brother has acted in bad faith with respect to the house and cannot be expected to behave as a fiduciary going forward. Another MAY be that you can bring in a co-trustee to assist you. Certainly you can hire an attorney to assist you as a consultant. IANAL and SGOTI is probably not an attorney experienced with your state laws and familiar with the local judiciary either. Hire an expert.
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Old 08-21-2021, 05:10 PM   #23
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OP has not mentioned it, but some of the bank accounts or brokerage accounts might have a TOD or POD on them.
These are NOT part of the Will.
They go to whoever is named on the various accounts, and technically the actual beneficiaries of these accounts are responsible for claiming the $$$.
Not the executor.

I'm throwing this out, as from my experience folks really mix up what is governed by the Will and what is outside the Will.
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Old 08-21-2021, 05:18 PM   #24
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... I'm throwing this out, as from my experience folks really mix up what is governed by the Will and what is outside the Will.
Yes and apparently an irrev trust here too. Hence the need for a good lawyer.
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Old 08-21-2021, 06:58 PM   #25
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I don't think I can hand it off. The language says:
If there is no serving trustee, then (me) shall serve as trustees. If (me) is unable or unavailable to serve as trustee, then (my brother) shall serve as trustee.

But if I can handoff, the bank or lawyer would handle an eviction, sale of the home, sale of the household items?

How much does something like that run?

FWIW, the house is worth about $330k net, and there's about $380k in cash and mutual funds.
OK, then it seems you can't just hand over executor/successor-trustee responsibilities.

But as others have said, I don't think that means you can't hire an attorney or bank rep to handle this stuff for you (you are still executor/trustee), and the cost comes out of the estate.

But try to get the brother to agree to the split of him getting the house plus $25K, you get the other half in $$$. That sounds simple. Make the point hat anything else will involve more costs and fewer $$$ to him.

But as I have learned, if he is the irrational type, well, rational approaches may not work.

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Old 08-21-2021, 07:05 PM   #26
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FWIW - If any of your dad's 'cash' assets are in a 401K or IRA, they cannot legally be held in Trust, but instead will be distributed to the specified beneficiary of the account.

I agree with JP. If your brother can't seem to move out, and it's all the same to you, then just give him the house and keep the cash for yourself. It doesn't sound like you are required to ask for his advice on how to split the assets as long as everything is equal.

Unless the trust specifies otherwise, it's up to you as the trustee to make the decisions on the implementation of the distribution of assets. Have an attorney advise you on how to handle the property appraisal for valuation to avoid a conflict of interest. Once you let your brother know your plans, he may change his plans quickly.
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Old 08-21-2021, 07:24 PM   #27
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Whatever you do, do it, and do it sooner rather than later.
I am 9+ years owning half a home my sister lives in. She lived with mom the last 6 months before she died.

I have never received a dime. She says she tried to get a mortgage to pay me of, but didn't qualify. She's now 64, no better job prospects, has no savings. Last year I told her to start applying to subsidized housing because it takes a while to get in. I doubt anything has happened. I'm 1000 miles away.
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Old 08-22-2021, 04:06 AM   #28
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But the beneficiary of a 401K or IRA can be the trust.
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Old 08-22-2021, 05:20 AM   #29
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I am a lawyer (albeit now retired). It is time to get a lawyer that specializes in estate litigation. Preferably the attorney will be located in the county where the property is located. Depending on that location, it may be difficult to find an attorney with that specialty. In that case I would find an experienced litigator who has previously litigated estate cases and knows his way around a Surrogate's Court. You need a litigator who has a firm grasp of estate disputes or an estate attorney who actually litigates.

These situations do not improve and only get worse. If the money is material to you then it is better to deal with these issues sooner than later. That is before your brother and his family devalue the house. If the money is immaterial to you, he/she can best advise how to extract yourself from the roles bestowed on you without becoming personally liable. It is very hard to have a favorable outcome when you do not understand the rules.
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Old 08-22-2021, 05:53 AM   #30
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To the OP, I lean towards keeping things simple, even trading off what is "fair" for simplicity when one does not need the money. I agree with those who say to give your brother the house and you keep a share of the cash and mutual funds. I would actually sweeten the deal and offer the brother more than his "fair" share - say the house plus $50-$80K.

It is clear the brother does not want to/cannot afford to buy the house. Is it clear that moving his son and daughter in law in is a way to dissuade you from selling it. For me that would be a headache that giving him more than what is due to him is worth buying out.

The house does not sound like it is in pristine condition, and you said you need to sell by September or else will likely have to maintain it through the winter. Think of the effort to get the house ready to sell, and how much (or little) you would get help in this from your brother and his family.

Essentially you would be paying your brother to take that headache off of your hands. In may seem "unfair" in the short run, but given what you have posted about the situation, the long term benefit will be worth it.
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Old 08-22-2021, 06:50 AM   #31
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Here's some language I found in the trust

5.1 Administrative powers
We give our trustee (me) all of the powers by (state law)..as they would be exercised by an ordinarily prudent person in managing the person's own property

5.2.8 To divide trust assets into separate shares, whether pro rate or no pro rata, to determine values, to distribute lie or unlike assets to different Beneficiaries or Trusts and to make distribution in cash or in kind, in divided or undivided interests.

There's also this though:
3.1 the Trustee shall divide any property passing to the Trust into equal shares, one for each child of the Settlors...

This seems to say I can give him the house and I take the mutual funds.

BTW, there is an IRA worth nearly $1m that we will be splitting per the bene designation. And while taxable, it's not like he's getting stuck with anything.
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Old 08-22-2021, 07:31 AM   #32
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Find a lawyer and fast. Hopefully, the language gives you broad decision making authority regarding the distribution of the assets and the language above seems like it does. Iíve handled executor duties before and would have been very comfortable giving up the house and taking an equal value in cash/equities. In fact, I would have been thankful that a sibling tried this move because selling a house is a pain. Get the property appraised by a realtor and be done with it.

One tough part about the executor role is the emotion of dealing with the passing and then the heirs. When an heir is not being ďgoodĒ or cooperative, it makes things easier to take the emotion out of things and do things to make your life as executor a lot easier versus what can be a more painful path and more work because you are trying to help an heir.

If the relationship is already damaged, start documenting what your brother has done and send him letters asking him to leave, and then just do what is equitable but easier. I may not even ask him his preference at this point. Being an executor is a thankless, time consuming, and sometimes difficult job. Feel free to track your hours and charge them back to the estate. When my wifeís father died without a will, her family made her life quite difficult and did nothing. She meticulously documented her hours and charged a fair rate (her annual compensation at work converted to an hourly rate) for the time she spent administering the estate. What a mess. Her family didnít love the idea of being charged for her time but they liked the fact that she did all the work and they got a spreadsheet with details of the estate and a check. They want her to be the executor of their estates.

Good luck. Youíve been Mr. Nice Guy, now is the time to be clinical.
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Old 08-22-2021, 07:38 AM   #33
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But the beneficiary of a 401K or IRA can be the trust.
You should never put IRA into a trust because it means immediate lump sum distribution and taxes, instead of over a 10-year period.
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Old 08-22-2021, 07:46 AM   #34
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The BIG problem is my brother's son and wife moved in "temporarily" at least 6 weeks ago. He was supposed to be out in under 30 days. They have not paid rent or any bills.
Hopefully, "at this point" you are not paying the utility bills too. If it was me, I'd notify the utility companies that the "estate" wants the services turned off. Overall, it sounds like it's time (past time) for some tough brotherly love. As the executor you should be in the drivers seat.
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Old 08-22-2021, 07:56 AM   #35
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You should never put IRA into a trust because it means immediate lump sum distribution and taxes, instead of over a 10-year period.
I hope the OP's brother doesn't do what my stepson planned to do. In DH's last months we told him he'd be getting DH's IRA, which was about $14,000. He was intently interested in how he could quickly liquidate it. After DH died I wrote him a check from other funds for $14,000 and moved the IRA to my name.

OP, keep us posted- it will be interesting to see what a lawyer says and what your brother decides. If he sees that he's passing up Real Money (his share of the proceeds from the house) in order to let his son and DIL stay in the house for free he might change his mind. Even though only one person replying here is a (retired) lawyer, discussions such as these can help you think about options and formulate the right questions before you consult one who knows the local laws and is an expert in this area and that can save you some billable time!
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Old 08-22-2021, 07:58 AM   #36
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You should never put IRA into a trust because it means immediate lump sum distribution and taxes, instead of over a 10-year period.
Do you have a source for that? Everything I just found said 5 years to distribute, maybe more under certain conditions.

I didn't see anything that said "immediate" or within a year.

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Old 08-22-2021, 08:06 AM   #37
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Here's some language I found in the trust

5.1 Administrative powers
We give our trustee (me) all of the powers by (state law)..as they would be exercised by an ordinarily prudent person in managing the person's own property

5.2.8 To divide trust assets into separate shares, whether pro rate or no pro rata, to determine values, to distribute lie or unlike assets to different Beneficiaries or Trusts and to make distribution in cash or in kind, in divided or undivided interests.

There's also this though:
3.1 the Trustee shall divide any property passing to the Trust into equal shares, one for each child of the Settlors...

This seems to say I can give him the house and I take the mutual funds.

BTW, there is an IRA worth nearly $1m that we will be splitting per the bene designation. And while taxable, it's not like he's getting stuck with anything.
IANAL, and 3.1 seems to contradict 5.28. Unless in legal terms "property" and "assets" are two different things?

OK, found this:

https://dictionary.law.com/default.aspx?selected=1645

Quote:
property

n. anything that is owned by a person or entity. Property is divided into two types: "real property," which is any interest in land, real estate, growing plants or the improvements on it, and "personal property" (sometimes called "personalty"), which is everything else
So it doesn't specify "real" or "personal" property, so I don't know what it means.

When I finally get around to updating our docs, I'm telling the lawyer upfront that I need a "common man" interpretation of each and every paragraph. After all, the executors/trustees are often not lawyers, it should be written for them to understand.

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Old 08-22-2021, 08:23 AM   #38
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You should never put IRA into a trust because it means immediate lump sum distribution and taxes, instead of over a 10-year period.
Funny, our expert trust and estate attorney doesn't believe this to be true.
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Old 08-22-2021, 08:23 AM   #39
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I don't think I can hand it off. The language says:
If there is no serving trustee, then (me) shall serve as trustees. If (me) is unable or unavailable to serve as trustee, then (my brother) shall serve as trustee.

But if I can handoff, the bank or lawyer would handle an eviction, sale of the home, sale of the household items?

How much does something like that run?

FWIW, the house is worth about $330k net, and there's about $380k in cash and mutual funds.
I don't think that you can decline to serve because then brother would become trustee.... but you could hire a bank or lawyer to handle those things for you just like you would hire a real estate agent to sell the house.

You are the trustee so you are in control... brother is currently a squatter since he stayed longer than you agreed to let him stay and he doesn't have a lease.

I would propose to brother that he will receive the $330k house free and clear and $25k, for a total of $355k of value and you will receive $355k in cash and mutual funds. If he later decides that he doesn't want the house then he can sell it.

Since you are already FI and are also getting $500k inherited IRA, you might even want to tilt the deal a bit to induce him to accept it... perhaps make it that he gets the $330k house and $50k for a total of $380k in value and you get $330k... it might be the best $25k windfall that you ever spent.

Given him 7 days to decide and if he decides to take the house and cash have him put it in writing.... then get the house and cash transferred to him asap... engage a lawyer to do a document where he acknowledges that he accepts this in full satisfaction of what he is due under the terms of the trust.

If he decides that he doesn't want the deal, then he has 14 days to move out or he will be cited for trespassing so you can prepare the house for sale.
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Old 08-22-2021, 09:06 AM   #40
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OP, if you follow the path of dividing the estate giving your brother the house and some cash, be sure you follow the legal requirements for establishing the value of the house. The estimate you have from the real estate agent is not it.
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