Thursday, September 29, 2005

Selling Real Property from an Estate

Category: Probate and Estate Administration

A client recently called me under the misconception that she could not sell her deceased sister's condominium until that estate was finalized and all taxes were paid. She had found a buyer for the real estate and wanted to sell it as soon as possible.

Where an estate owns real property, the State of New Jersey has a lien on that property for any potentially unpaid inheritance or estate taxes. This lien may be removed by the issuance of Real Property Tax Waiver by the State, which is then filed by the County Clerk in county in which the property is located.

A Real Property Tax Waiver can be issued by one of two ways:

1 - If (a) all the estate beneficiaries are Class A (lineal ascendant and descendants, and your spouse), and (b) no New Jersey Estate Tax is due, then a Form L-9 can be filed affirming to the New Jersey Inheritance Tax Division that no tax is due. Upon processing, and Real Property Tax Waiver will be issued to be filed with the County Clerk.

2 - If an Inheritance Tax or Estate Tax is due, then the Real Property Tax Waivers will be issued together with a letter from New Jersey that it has accepted as correct all Inheritance and Estate Tax returns filed and payments made. This normally takes well over a year from the date of death, due to the time necessary to prepare and file the returns, and then have them reviewed by New Jersey.

What happens if there is a tax due and you want to sell the property before the Real Property Tax Waiver has been issued? As a practical matter, the buyer's title company will require that some percentage of the sale proceeds be held in escrow until the Real Property Tax Waiver has been issued. This does not prevent the sale, but instead creates a fund from which to pay the taxes. The escrow can be released either (1) to New Jersey or the IRS to pay taxes due, or (2) upon presentation of Real Property Tax Waiver.

12 Comments:

At 6:53 PM, Anonymous Anonymous said...

I have a question if the Estate had property. That wasn't listed in the Will. Does the Executor have to send something to the Beneficiaries and have them sign a document saying they do not want to purchase the property.

(OR) can the Executor turn around and sell it to one of the Beneficiaries without notice from any of the other Beneficiaries that they do not want the property? How does that work? Signed confused

 
At 4:11 AM, Blogger paula said...

Great blog you have here and great post this is. Hoping to read more. Thanks for the info.

Paula M
philippine real estate

 
At 4:50 AM, Anonymous Anonymous said...

Great blog you accept actuality and abundant column this is. Hoping to apprehend more. Thanks for the information.Real estate for sale ads

 
At 9:04 AM, Anonymous Anonymous said...

I have a question, I live in Arkansas-I am the executor of my late wifes estate. I have legal documents where all the beneficiaries signed over 100% of the estate to me.I'm wanting to assume the loan on this property that has been my home for the past 15 years. The estate is in probate, how do I get it released from probate?

 
At 3:08 AM, Blogger Unknown said...

chalet a louer quebec
Thank you for sharing this article. I love it. Keep on writing this type of great stuff.

 
At 1:48 AM, Anonymous Anonymous said...

It is a great article and it has a lot of useful information about real estate. Selling any property is too hard to do because you need a lot of effort to do. Anyway thanks for sharing this info.

 
At 2:14 AM, Blogger limostarz said...

Great blog you have here and great post this is.
Limo Services in Bay Area

 
At 10:42 AM, Blogger Unknown said...


dang...dang...dang! need to seriously look at that limosine company, driver policy and practice...seem like the
victims could not opened the door from the inside...driver may have had the children safety aka drunk passengers
lock-on...mmmm, so only the skinny people got out??? dry them tears...time to sue...driver not shaken playin stupid...

 
At 11:19 PM, Blogger Unknown said...

Great blog you accept actuality and abundant column this is. Hoping to apprehend more. Thanks for the information.
Property for sale

 
At 2:43 PM, Blogger Unknown said...

Useful info. Hope to see more good posts in the future.
Realtor Websites

 
At 10:17 PM, Blogger Unknown said...

Nice post. selling properties such as selling other financial products. and this can be done with the support of the purchasing power of the general public. What happened today is, high income does not affect the real purchasing power. and this is often the case, it is necessary a short-term strategic action, which involves the economic situation of business in general, please follow us on: http://en.sedico.orangefield.com/real-estate-administration/ ... thanks for share ,

 
At 10:44 PM, Anonymous Avida Towers Asten said...

Awesome post you have here! Thank you very much for sharing! This'll be very helpful for everyone.

 

Post a Comment

<< Home