Probate/Massachusetts Estate Tax Lien

PROBATE AND ESTATE TAX IN MASSACHUSETTS

When someone passes away, there are two legal concerns that must be addressed:

1. Is a Probate of the estate necessary?

2. What is required to clear any potential Estate Tax Liens?

When is a Probate Necessary? Usually when the decedent (the person who died) has assets in his/her name alone, a Probate will be necessary. If the decedent had a Will, then the will is filed in Probate Court with the appropriate Petition asking that the Will be allowed and that the Executor (the person nominated in the Will by the decedent to be in charge of the estate) be appointed. A publication regarding the Will and the Petition must be published in the decedent’s local newspaper. If the decedent did not leave a Will, then a Petition for Administration would have to be filed in Probate Court. If the decedent’s assets are valued less than $15,000 (not including the value of any automobile) and do not include any real estate, then a voluntary administration is available which is less formal.

We can help you determine if a Probate is necessary and what the appropriate filings would be for Probate Court. We would prepare all the necessary documents for filing in Probate Court. For a typical estate, you would not need to appear at Court, we would go to Court for you.

What is required to clear an Estate Tax Lien? We currently have an estate tax system (sometimes called death taxes) for both the Federal government and for the Commonwealth of Massachusetts. Most people do not realize that if you die owning an interest in real estate in Massachusetts, even if the real estate is owned in joint names, there is an automatic ten (10) year Massachusetts Estate Tax Lien on that real estate unless you follow the proper procedures to release the lien. That means you would be unable to sell or remortgage that real estate due to the Estate Tax Lien. This lien is by operation of law so you do not receive any notice of the lien.

The good news is that very few estates actually owe any estate taxes. In 2006, you would have to have an estate worth Two Million Dollars ($2,000,000) to owe any Federal estate taxes. If the estate is worth more than Two Million Dollars (you must include all of the assets such as life insurance, pensions, etc. in the valuation) then a Federal Estate Tax Return and a Massachusetts Estate Tax Return would be required to be filed within 9 months from date of death. As of 1/1/06, if the estate is worth One Million Dollars ($1,000,000) , then a Massachusetts Estate Tax Return would have to be filed and appropriate taxes paid within 9 months from date of death.

If the estate is valued at less than One Million Dollars ($1,000,000), then the Massachusetts Estate Tax Lien can be released by filing Affidavits signed by the Executor or Administrator of the estate or by the joint owner of the real estate with supporting documents in the appropriate Registries of Deeds.

We understand that losing a loved one is a difficult time in your life. When you meet with us, we will explain the process to you, determine what is necessary and do everything we can to simplify matters for you.

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