Perhaps someone can help me determine what the most equitable distribution of an estate would be. The hypothetical situation is as follows: a.. $500,000 from proceeds of house sale b.. A vehicle worth $7000 c.. Four heirs One of the four heirs wishes to pay for the vehicle from her share of the estate. How do we do it? It seems simple but there are several ways of looking at it.
I take it you don't play poker. This is a split pot when one winner was light. You divide $507,000 by 4. The carless heirs get that amount of cash; the driver gets the rest of the cash and the car.
-- Phil Marti Clarksburg, MD
The simplest way is to have the vehicle sold to the person who wants to buy it. Deposit the sales proceeds into the estate, you now have $507,000 to divide four ways. Each heir receives a distribution of $126,750. There are other, messier ways, but simple works best. Everyone understands simple.
-- Paul A. Thomas, CPA Athens, Georgia
Four *equal* heirs?
Total estate value: $507,000, consisting of $500,000 cash plus a car worth $7,000. (I assume no arguments over the value, and that the heir who wants the car is willing to pay $7,000 for it.) Estate value per heir: $126,750.
Three heirs get that much in cash. The fourth gets $119,750 plus the car. Or, the one buys the car for $7,000 "cash" (actually an IOU). The estate now has $507,000 cash. Each heir gets $126,750; the one who got the car gets back her IOU as part of her cash. Same result as above. Seth
total estate = 507,000. 1/4 interest = 126,750 she takes the car and $119,750 of cash and the others take their $126.750 of cash. ed
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