Readers in Lee County are likely aware that a will and estate plan are often used together to express how a person wants their affairs to be settled after their death. Unless a person leaves a specific item or other specified asset to an heir, their possessions and resources are often sold, with the monetary worth going to beneficiaries as indicated. In some cases, however, it may be difficult to determine the value of a person’s assets, complicating the probate process.
Asset valuation is not as scientific as some would believe it to be. In fact, in some cases it is highly a speculative art. It can be difficult to ascertain an accurate value for certain assets, such as Internet domains, art collections and patents. This is especially true for assets like royalties and small businesses whose value can be drastically affected in one way or the other by the death of the owner.
Inaccurately assessing the value of an estate can not only result in heirs receiving incorrect inheritances. Since estate tax responsibilities are based primarily on the value of the estate, assessment errors or discrepancies can lead to an IRS audit and possibly even legal issues for the administrator of the estate.
Although you cannot prevent all problems that could arise after you pass away, careful estate planning can help you to avoid some. If you have not already, it may be of benefit to consult with an experienced attorney in order to create a plan for how you want your affairs to be handled after your death. A lawyer can explain all of your options and help to ensure you have the necessary documents and plans in place to make the estate administration and distribution of assets processes as smooth as possible for those you leave behind.
Source: New York Times, “Putting an Estate Value on the Assets Unique to You”, Paul Sullivan, Sep. 27, 2013