Estate Solvency in California
Often times medical bills and other related health expenses can begin to accrue at a substantial rate toward the end of someone's life. These debts must be paid, but you'll first need to determine whether an estate is solvent or insolvent.
Defining a Solvent Estate
A solvent estate is an estate where the assets of the estate exceed the decedent's debts. This essentially means all of the decedent's individual assets have a combined value which is greater than any bills that are owed, and there are enough assets to pay off a decedent's creditors.
What Happens to Assets in a Solvent Estate?
When the estate is determined to be solvent, it is then the responsibility of the estate's personal representative, or executor, to pay off those bills using the assets from the estate. Once the probate period ends and all of the legitimate bills and expenses are paid, clearing the estate of all debts, then the remaining estate assets can finally be distributed to the beneficiaries in accordance with the will or with California's intestacy laws.
Consulting with a professional estate administration lawyer may help to determine whether an estate is solvent. This way, you can get any debts organized and paid so that beneficiaries can receive their distributions as quickly as possible.
*This blog entry was not written by an Attorney and should not be constituted as professional legal advice.