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A Simple Estate Matter? Not so Fast

     Mark called because he needed assistance with an inheritance tax return. The attorney he had hired to assist him in selling his sister, Melanie’s home was unsure how to complete it.

     A little bit of background is helpful. Melanie died without a will. She had never married and had no children. Accordingly, under New Jersey’s intestacy laws, which determine how assets are distributed when one dies without a will, Melanie’s estate next passes to her parents. However Mark told me they both died years ago. Next in line are Melanie’s siblings.

     Mark told me he had already gone to the Surrogate to be appointed administrator. He said his 3 siblings signed renunciations as administrator in favor of him. He now just needed help filing the inheritance tax return so he could then distribute the estate to himself and his 3 siblings.

     I explained that the tax is calculated based on the relationship of the heirs to the person who died. But what he had said early in our conversation raised some questions which caused me to inquire further. He had said at one point that Mary had 5 siblings but later referred to his 3 siblings (plus himself would be 4). Did he misspeak?

     When I pointed that out to him he then told me that the fifth sibling, Frank was born with Down Syndrome and was declared incapacitated years earlier. Mark is his guardian. “Frank lives in a group home and receives government benefits so he can’t receive any money from Melanie’s estate,” Mark told me.

     While it is true that Frank will lose his benefits if he receives an inheritance, Mark was incorrect in thinking he could simply ignore Frank as an heir. Legally Frank is entitled to a 1/5 share.

     Mark couldn’t understand why neither his attorney nor the Surrogate told him any of this. I explained to him that his attorney wouldn’t know if he doesn’t handle estate matters (Mark said he does not). The Surrogate also wouldn’t tell him because they simply take the information provided to them. They don’t ask in depth questions and do not provide legal guidance. He told them Melanie had 4 siblings. They don’t verify the information.

     “So what do I do now,” Frank asked. Next week I’ll share with you what I told Frank.