As the personal representative of a New York estate, you essentially assume responsibility for everything left undone by the deceased. You will fulfill their last wishes as outlined in their will, if they provided one. You will secure their property, communicate with their loved ones and uphold their will by following their instructions regarding their property.
You will also have to cooperate with the New York probate courts, any creditors owed money by the deceased and the beneficiaries of the estate to properly distribute to the remaining property. Sometimes, either because you need liquid capital to pay creditors or because it was part of the plan provided by the decedent, you will have to organize an estate sale.
There are two important financial considerations that you cannot ignore when conducting an estate sale.
It can lead to additional tax obligations
If you simply sell off a few pieces of furniture or personal property, then there may not be any complications that arise from doing so. However, if you have to sell real estate or an entire household worth of property, an estate sale may lead to income tax obligations. Any estate that generates more than $600 in revenue by selling estate assets will be subject to income taxes.
You may have to file an estate income tax return and retain money from the sale to pay those taxes. If you fail to file the proper paperwork or if you distribute all of the proceeds of the sale without retaining enough to pay the taxes, you could face legal and financial responsibility for those oversights.
You need to balance expediency with profits
As the representative of a New York estate, you have an obligation to the beneficiaries of that estate to maximize what they inherit. If you must sell estate assets, then it is important that you get the best price possible or at least close to the fair market value for the property. Otherwise, if you sell a vehicle or $10,000 for $600, beneficiaries for the estate could challenge your actions and cause major probate complications.
Identifying possible estate administration challenges before they arise will make it easier for you to fulfill your duties.