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How Should you Respond to a Request to Waive Bond, Inventory and Accounting in a Tennessee Estate?

Posted on Jan 25 2015 12:20PM by Attorney, Jason A. Lee

Sometimes when a Tennessee probate estate is opened up, the attorney handling the estate will provide a request to the beneficiaries to waive bond, inventory and accounting [“Bond” is basically an insurance bond to protect the assets of the estate if there is a failure by the executor.  “Inventory and Accounting” are required reports to beneficiaries and the court on the financial status of the estate].  This may be unnecessary in some circumstances if it is actually already waived in the will by the decedent.  However, sometimes wills do not include this language.  Or, many individuals die intestate (without a will).  I often get asked by beneficiaries who receive a request to waive bond, inventory and accounting as to whether they should agree to this request.  When I personally handle estates as the estate attorney I also send out these same letters to beneficiaries on many occasions. 

 

The short answer on how to handle this situation (and the advice I give to others) is that if the individual is a family member and you trust them to handle the estate appropriately, then I do not see any issue with waiving bond, inventory and accounting.  This is especially true with smaller estates.  However, if there is an estate of a significant size and you have any issues of doubt, hesitation or trust concerning the individual who will be handling the estate, then I suggest that you not waive bond, inventory or accounting.  Refusing to waive these items can force the executor to be more accountable for their actions in the estate (by requiring them to provide financial updates under the statute).

 

There is no perfect answer to this question but certainly if you do not trust the individual who will be handling the estate, then I recommend you not agree to waive bond, inventory or accounting.  Further, if the individual is someone who is not a family member and it is a sizeable estate, you also need to think long and hard about whether it is appropriate to waive bond, inventory or accounting.  Keep in mind however, that when you do not waive these items, it does increase the cost of estate administration (the insurance bond costs money and the inventory and accounting increase the paperwork and fees of the attorney handling the estate).  Also, if you do not feel comfortable waiving the bond, inventory or accounting, then I would also recommend that you hire an attorney to represent you as a beneficiary in the estate.  This gives you more of a voice in the estate administration process and also provides you with someone who can give you counsel on what is occurring in the estate.

 

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Tennessee and Federal Estate Tax Exemptions Raised Today for 2015.

Posted on Jan 1 2015 11:13AM by Attorney, Jason A. Lee

Today the Tennessee Inheritance Tax exemption (for 2015) is raised to $5,000,000.00.  Next year the Tennessee Inheritance Tax will be abolished.  Starting January 1, 2016 (for those who die on or after that date) there will no longer be any Tennessee Inheritance Tax obligations.  The Federal Estate Tax exemption (for 2015) was raised to $5,430,000.00 today.  It is indexed to inflation and should go up each year.  As a result, these taxes rarely come into play when dealing with estate planning in Tennessee unless you have a very large estate.  Happy New Year!

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Jason A. Lee is a Member of Burrow Lee, PLLC. Contact Jason at 615-540-1004 or jlee@burrowlee.com for an initial consultation on wills estate planning and probate issues.

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Tennessee Wills and Estates Blog
Jason A. Lee, Member of Burrow Lee, PLLC
611 Commerce Street, Suite 2603
Nashville, TN 37203
Phone: 615-540-1004
E-mail: jlee@burrowlee.com

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