Hello, I am a new member officially today, and this is my first post!!
I have a situation which was cut and dry, only turned out to be a problem. First off I am not from PA, I live out of state, I was going to appoint an attorney for this, But after speaking with the probate clerk and seeing the estate was so small, I figured I could do this myself, plus with actually doing all this paperwork, it would help me grieve. Oh hingsight is 20/20. Let me explain:
My father passed away just over 1 year ago. I am the executrix. I am a pretty intelligent woman, and purchased books etc. I also followed isntructions from the Register of wills department.
1. A probate was opened and legally advertised as instructed. He had 3 items in his name only small checking account, vehicle, and a home. He also which I knew at this time, had Secured debts attached to these items.
2. at probate I explained to clerk about these items, and I had heard that I should have an attorney. I aked the clerk to recommend some, he did and I called a few and they explained that since I do live out of state, and the estate is so small, I could probably handle it myself. I did.
3. a month after probate was opened I found an IRA, not an employee related one, just one he and my late mother contributed to. This was actually an annuity, consisting of stocks/bonds which he didn't contribute to, but it grew in value. He had this for over 25+ years with beneficiaries listed on the form. Since he was over 70 1/2 he had started taking out the mandatory amounts each year.
4. Because of the beneficiaries listed, this bypassed probate, as I was told by the brokerage company. Additionally, this account was immediately frozen and was distributed to his beneficiaries listed. I DID NOT DISTRIBUTE THIS. THE BROKERAGE COMPANY DID. THIS WAS NOT PART OF THE ESTATE.
5. The bills started piling in......My father ended up owing more than he had in his estate.
6. I did what I was suppose to, stamped bills as they arrived, notified all his creditors that this may be an insolvent estate and paid what needed paid; ie, secured debts.
7. nine months I WAS FORCED TO FILL OUT THE INHERITANCE TAX SCHEDULE 1500. I did this, when it came to IRA's, I called the inheritance tax division in PA and they asked me numerous questions, I answered and was advised that this IS taxable, and enter it on schedule "G". I did.
8. Now it is over a year later and I received a letter from a credit card company who put in a claim within the allotted one year time frame. She was asking for an update, which I told her his estate ended up insolvent. she asked me for a form that the court provides. I called the court and they told me it would be the Inheritance tax 1500 schedule. Oh ok...
9. I looked at this form........and it shows the IRA on this form. So instead of the estate being a NEGATIVE -427.00 (from all his secured debts, there are still over 100,000 unsecured debts NOT paid), it shows a positive +212,000.000 from the IRA.
10. I immediately called the inheritance division, and explained this, and she said you CANNOT file an ammended schedule 1500. I told her that I only did what I was instructed to do line by line with her department. She advised me, this is why YOU needed a lawyer. She then asked me why the debts couldn't be paid since there is funds, I told her that I had NO control over the IRA, the brokerage company PAID it out to the beneficiaries, already, there are NO funds.
11. I was given a phone # to the inheritance help line in harrisburg, and I called them, She was so nice and explained that I still HAD to pay inheritance taxes on the IRA, however The office should of instructed me to INDIVIDUAlly file this way it would NOT show up on the "estate" public records.
12. The estate is Closed, I have filed the final status report. The vehicle was surrendered, as nobody wanted to buy it, and I couldn't continue paying the monthly payments. The house was sold, and immediately the equity loan was paid off on it, so the proceeds from that was extremely small. The remainder proceeds went to administrative expenses, utilities for the secured home etc....
So the bottom line is this: I have to send the creditor(truthfully, I don't have to send it, the probabe department said, make them work for it.), but she has been so nice I watned to help her) who has put in a 30,000 claim against the estate, a form. The form i'm suppose to send is the Inheritance form from the State. This is the ONLY form you get from them. This form will show the positive balance, when in realty it is insolvent. The IRA as I mentioned above, has been distributed, and I wasn't able to touch it even in the beginning. I'm NOT disputing the inheritance tax owed, that has been paid, I'm confused/concerned about the showing of the positive balance, when there is actually a defecit. What do I do?
I have a situation which was cut and dry, only turned out to be a problem. First off I am not from PA, I live out of state, I was going to appoint an attorney for this, But after speaking with the probate clerk and seeing the estate was so small, I figured I could do this myself, plus with actually doing all this paperwork, it would help me grieve. Oh hingsight is 20/20. Let me explain:
My father passed away just over 1 year ago. I am the executrix. I am a pretty intelligent woman, and purchased books etc. I also followed isntructions from the Register of wills department.
1. A probate was opened and legally advertised as instructed. He had 3 items in his name only small checking account, vehicle, and a home. He also which I knew at this time, had Secured debts attached to these items.
2. at probate I explained to clerk about these items, and I had heard that I should have an attorney. I aked the clerk to recommend some, he did and I called a few and they explained that since I do live out of state, and the estate is so small, I could probably handle it myself. I did.
3. a month after probate was opened I found an IRA, not an employee related one, just one he and my late mother contributed to. This was actually an annuity, consisting of stocks/bonds which he didn't contribute to, but it grew in value. He had this for over 25+ years with beneficiaries listed on the form. Since he was over 70 1/2 he had started taking out the mandatory amounts each year.
4. Because of the beneficiaries listed, this bypassed probate, as I was told by the brokerage company. Additionally, this account was immediately frozen and was distributed to his beneficiaries listed. I DID NOT DISTRIBUTE THIS. THE BROKERAGE COMPANY DID. THIS WAS NOT PART OF THE ESTATE.
5. The bills started piling in......My father ended up owing more than he had in his estate.
6. I did what I was suppose to, stamped bills as they arrived, notified all his creditors that this may be an insolvent estate and paid what needed paid; ie, secured debts.
7. nine months I WAS FORCED TO FILL OUT THE INHERITANCE TAX SCHEDULE 1500. I did this, when it came to IRA's, I called the inheritance tax division in PA and they asked me numerous questions, I answered and was advised that this IS taxable, and enter it on schedule "G". I did.
8. Now it is over a year later and I received a letter from a credit card company who put in a claim within the allotted one year time frame. She was asking for an update, which I told her his estate ended up insolvent. she asked me for a form that the court provides. I called the court and they told me it would be the Inheritance tax 1500 schedule. Oh ok...
9. I looked at this form........and it shows the IRA on this form. So instead of the estate being a NEGATIVE -427.00 (from all his secured debts, there are still over 100,000 unsecured debts NOT paid), it shows a positive +212,000.000 from the IRA.
10. I immediately called the inheritance division, and explained this, and she said you CANNOT file an ammended schedule 1500. I told her that I only did what I was instructed to do line by line with her department. She advised me, this is why YOU needed a lawyer. She then asked me why the debts couldn't be paid since there is funds, I told her that I had NO control over the IRA, the brokerage company PAID it out to the beneficiaries, already, there are NO funds.
11. I was given a phone # to the inheritance help line in harrisburg, and I called them, She was so nice and explained that I still HAD to pay inheritance taxes on the IRA, however The office should of instructed me to INDIVIDUAlly file this way it would NOT show up on the "estate" public records.
12. The estate is Closed, I have filed the final status report. The vehicle was surrendered, as nobody wanted to buy it, and I couldn't continue paying the monthly payments. The house was sold, and immediately the equity loan was paid off on it, so the proceeds from that was extremely small. The remainder proceeds went to administrative expenses, utilities for the secured home etc....
So the bottom line is this: I have to send the creditor(truthfully, I don't have to send it, the probabe department said, make them work for it.), but she has been so nice I watned to help her) who has put in a 30,000 claim against the estate, a form. The form i'm suppose to send is the Inheritance form from the State. This is the ONLY form you get from them. This form will show the positive balance, when in realty it is insolvent. The IRA as I mentioned above, has been distributed, and I wasn't able to touch it even in the beginning. I'm NOT disputing the inheritance tax owed, that has been paid, I'm confused/concerned about the showing of the positive balance, when there is actually a defecit. What do I do?
