How to Handle Unusual Estate Assets

Whether a deceased person leaves a valid Florida Will or not, their possessions must go somewhere, usually through probate. During a probate proceeding, a personal representative will be appointed to settle the decedent’s affairs and dispose of their estate assets. That sounds simple on paper, but the personal representative often has a huge job ahead of them. This is especially true when the estate includes unusual estate assets.

Duties and Responsibilities Toward Estate Assets.

The personal representative of the estate:

  • identifies and gathers assets owned by the deceased person;
  • maintains estate assets,
  • observes a standard of care,
  • settles and distribute estate property, and
  • closes the estate when administration is complete.

At all times, the personal representative should act in the best interests of the estate.

Wasting Assets

Some assets lose value due to depreciation or because they are not in use. It’s the personal representative’s responsibility to address problems with wasting assets.

  • Cars, trucks, recreational vehicles, aircraft, and boats depreciate. These assets also require maintenance, annual licenses, and insurance.
  • Investment strategies may need an overhaul due to market conditions. Otherwise, the value of investments may drop dramatically
  • Commercial property, especially if vacant, may be costly to the estate. The personal representative may be faced with the choice of selling the property or turning it into an income producer for the estate.

Perishable Assets

Some assets are difficult to manage because of Florida’s humid subtropical climate. Perishable assets literally may perish without the right care.

  • Wine collections often are kept in climate-controlled rooms.
  • Art collections also may need extra care to prevent damage.
  • Racehorses will, of course, need to be fed and cared for during probate.
  • Assets in danger of destruction due to a hurricane might need to be moved to a safer location, if possible.

The personal representative will safeguard assets as much as possible. Occasionally, the cost to maintain an asset may be detrimental to the estate itself. Then, the personal representative has a tough decision to make: continue maintaining the asset or sell it.

Assets That Are Difficult to Value or Transfer

Many of the assets that fall into the “perishable” or “wasting” category may also be difficult to appraise or transfer. This puts the personal representative in an especially sticky situation. If not managed correctly, the assets may perish or waste, but illiquid assets may hold up administration.

  • For example, perhaps a patented invention is an estate asset. Will the invention make money or not?
  • The personal representative may know how much a race horse cost, but how much will it earn compared to expenses? It’s truly a gamble.
  • Collections may be difficult to appraise and For example, the estate may have to hire an expert to appraise a collection of books. Unless the Will specified what to do with the books, the personal representative may have to decide.
  • There are strict laws on selling firearms. The personal representative will need to understand those laws in order to avoid breaking them.

Keep in mind, too, that the appraised value of the assets is needed to calculate estate taxes.

Remember Unusual Assets When Planning Your Estate.

John Mangan is an experienced Florida estate planning attorney who has been board certified in Wills, Trusts & Estates by the Florida Bar. At the Law Offices of John Mangan, P.A., we have assisted many clients in developing comprehensive estate plans that meet their needs. Call us at 772-324-9050 to set up an appointment or use our convenient Contact Form.

 

See also:

3 Reasons to Set Up a Gun Trust

Florida Probate with an Out-of-State Executor

Florida Ancillary Probate

Written by John Mangan, Esq.

John Mangan, Esq.

I’m an attorney in Palm City, FL, and I serve clients throughout Martin County, including Stuart, Palm City, Hobe Sound, and Indiantown, as well as those in St. Lucie County, the Treasure Coast, Palm Beach County, and other parts of Florida. The Law Offices of John Mangan, P.A., is an innovative firm providing estate planning services to clients in Florida. We focus primarily on wills, trusts, asset protection, guardianship, and probate administration.