Bay Area Estate And Tax Planning Law Firm

Inventory and Appraisal: The Basics, part 2

On Behalf of | Jul 27, 2015 | Uncategorized |

We are picking up where we left off with our June 20 post. We were talking about what goes into the inventory and appraisal of a decedent’s estate in California. The law does not require an inventory for every estate; the administration of a small estate, for example, does not include filing an inventory and appraisal with the court. When one is necessary, though, the responsibility falls to the personal representative.

The inventory must include certain items by law (described in our June 20 post). We know, however, that there is a lot more to an estate than cash on hand and shares in a business. The PR will do well to inventory the decedent’s tangible personal property, too. Furniture, clothing, kitchen and household items, jewelry — the inventory should include everything that a homeowners insurance policy would cover. In some cases, details are not necessary: Small items of relatively little value can be grouped together. For example, paperback books and costume jewelry need not be itemized.

Remember, this is an inventory of estate assets. Anything that is not part of the estate should not be included. Life insurance, for example, or real estate outside of California should not be listed. However, a separate list of these non-probate assets can help the personal representative or the estate attorney identify missing information or address potential problems with distribution.

As for the appraisal, the PR may hire an independent appraiser or may leave it to the court to assign values to some items. In the end, each item must have a monetary value, the fair market value on the date of the decedent’s death.

One final — and important — note: All of the information in an inventory and appraisal becomes public record. If a testator does not want the value of the family home or car collection known, the testator should explore estate planning tools, including trusts, that would keep the information private.

Preparing an inventory may look like a huge task. The decedent’s accountant, investment adviser, personal assistant, insurance broker and estate planning attorney may be the best sources for information about assets. A personal representative should not hesitate to ask for help.

Source: California Civil Practice Probate and Trust Proceedings, Chapter 12. Inventory and Appraisal, Judge Arnold H. Gold, Monica Dell’osso, Mary F. Gillick and Jeremiah Moffit, current as of May 2015, via WestlawNext