Asset Valuation Disputes

Once you have located and collected the assets of the decedent’s estate, the next step is to determine the value of those assets. This valuation is generally required by the probate court and is important for several reasons: it helps assess whether the estate owes federal or state estate tax and aids beneficiaries in understanding the share they will receive.

However, disagreements often occur over assets. Asset valuation disputes often arise during probate when heirs, beneficiaries, or creditors disagree about the worth of estate property. The valuation of assets, such as real estate, businesses, investments, or personal property, directly affects how the estate is distributed and how taxes or debts are paid. These disputes can become highly contentious, especially when large or unique assets are involved.

Courts typically require that assets be valued at their fair market value, which is the price a willing buyer would pay a willing seller at the time of the decedent’s death. However, opinions often differ on what that value should be. Business interests, artwork, or collectibles can be difficult to price due to lack of comparable sales data.

Disagreements can also arise if beneficiaries believe an executor or trustee undervalued assets to reduce their shares or estate taxes, or overvalued them to favor certain heirs. When disputes occur, courts may appoint independent appraisers, accountants, or financial experts to conduct a neutral valuation. Here is a look at how certain assets are valued.

Real Estate and Vehicles

For real estate, you can engage a real estate agent who can compare the property to similar homes and evaluate current market conditions from a seller’s perspective. If the property is commercial or complex, you may hire a licensed appraiser for a detailed valuation.

For vehicles, typical used cars may be valued by referencing sources such as the Kelley Blue Book. But if the vehicle is an antique or has collector value, you should get an expert appraisal.

Businesses

If the decedent owned a business interest, you will likely need a professional appraiser to value both the tangible and intangible assets. This is especially important if the estate must file a federal estate tax return. If the decedent had a partnership interest or ownership in an LLC, check the relevant agreement to determine their interest and then obtain an appraisal or valuation from a CPA or appraiser.

Personal Property

Items like artwork, antiques, collectibles, or other personal property may require a specialist valuation. You can consult an auction house, museum, or professional appraiser. Professional organizations like the American Society of Appraisers or the Appraisers Association of America may be able to assist.

Seek Legal Help

When a loved one dies, family members do not always agree on assets and their value. Some people tend to think assets are worth much more than they really are, causing conflict.

Probate can be messy. Fort Lauderdale probate litigation lawyer Edward J. Jennings, P.A can resolve your disputes and help you move forward after a loved one’s death. To schedule a consultation, fill out the online form or call 954-764-4330.

Source:

justia.com/probate/probate-administration/the-duties-of-an-executor-of-an-estate/valuing-assets-in-an-estate/