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Can Creditors take all inheritance if there are outstanding judgements

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"Inheritance" is a term that typically money one receives from the estate of a deceased person and generally does not describe money received or to be received from a trust.  It's also not clear what your reference to siblings means.

 

If your intent was to ask whether money received or to be received by way of a will or trust is either partially or completely exempt from enforcement of a judgment.  If so, the answer depends on the applicable state law, but I don't know of any state that makes such money exempt.  Note, however, that, if the judgment creditor is a beneficiary of a trust, and if the trustee has discretion to make or not make disbursements, the judgment creditor may not be able to force the trustee to make a disbursement in order to satisfy the judgment.  A lot will depend on the specific terms of the trust.

 

For example, let's say that James has judgments against him totalling $50k.  James's mother recently died, and James stands to receive $100k from his mother's estate.  Again, depending on the applicable state law, James's judgment creditors could serve levies on the executor of the estate to compel the executor to pay the amount owed on the judgments to the creditors, which amounts would be deducted from James's share, the end result of which would be that James only receives $50k.  One would assume James would be elated under such circumstances because he no longer has to worry about the judgments.

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The state is Minnesota. The siblings are 8 brothers and sisters. All are named on Certificates of Deposit and in their mothers will. One sibling has civil judgements pending. Others may have creditors, but none are known to date. The father is deceased. The mother may change from a will to a revocable trust, naming all children. There is also property, land only, (no home) which is owned by the mother. The co-executors of her estate are wondering if the courts can take the total amount owed to the creditors, which exceeds the one sibling's share.

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If the mother has not passed away, then there aren't any co-executors yet.

 

The creditors of one sibling can't "raid" the entire trust or probate estate for payment of the one sibling's debts. 

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CDs that name pay/transfer on death beneficiaries aren't really part of the estate when your mother dies; they go to the named parties as a matter of contract.  (This doesn't mean that your state's laws may not effectively dictate that this dough can be gone after if the estate leavesdebt that needs paying.)
 

There may be people nominated in a will to act as co-executors, but her estate doesn't exist until she dies.

 

At any rate, it's unclear why someone would be concerned that one sibling's creditor is in a position to take mother's entire estate/trust.  Naturally, the creditor's free to think about going after that sibling's *interest* in the estate/trust, but that doesn't mean some creditor can go after your share.

What I'm more concerned about is people counting future chickens before the eggs have even been laid.  The kids absolutely should not presume that the mother won't need the money/won't need to cash out CDs and should absolutely not count on "inheriting" this dough.  To do that would presume she'll have no medical expenses even at end of life and/or won't need nursing home care.  (And 'lest mother think that "oh, I'll just use Medicaid (v. Medicare) and arrange it so that nothey can't come after the dough" ... I'd advise against it.  Medicaid-level nursing home care SUCKS, and any child who'd allow a parent to plan on that type of care just so their kids can have some money when they die (and stick the taxpayers with the nursing home care bill, btw) is not a good kid.  Just my humble opinion.)

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Wow, this is my first attempt at blogging and it's becoming quite an education. Thankfully, my mother is in very good health in her late 80's. She has asked two of us to serve as her co-executors. My concerns are to protect her limited assets,from some of my siblings creditors and judgements, to ensure she can maintain her current life style and live out her life as she desires and deserves. We are not counting chickens or intend to leave her scratching with the chickens. I am seeking information, so we can intelligently discuss matters while she is still very capable and has the foresight of preplanning. So put your concerns at ease.

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Unless she happened to guarantee any of her children's debts, your mother's assets are not at risk from her children's creditors.  After she dies, each child's interest in her estate is subject to his/her creditors.  However, Child A's creditors cannot get more from the estate than Child A is entitled to from the estate.

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I have almost the same situation.  I am in Virginia.  My mother died and left us 5 children her property in her will.  we are selling the property for $80,000 and it is to be split 5 ways.  My sister has a $53,000 judgement, and my lawyers assistant has informed me that if we do sell the property, the debtor of my sister will come and take all of our inheritance also, to pay for this debt.  then what is left, will be split 5 ways.  Is this legal?  She only owns 1/5th of the property.  Wont they only take her part of the inheritance money to pay her debts?  why would we be liable to pay for it?

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The judgment creditor is only entitled to collect your sister's interest in the property.  However, the purchaser's or mortgage company's title insurance company may have a problem with the sale of the property.  When your mother died and the will was recorded, the judgment creditor's lien attached to her interest i n the property.  The title insurer will undoubtedly require the judgment creditor to agree to file a satisfaction of the judgment to the extent the lien is paid.  You may need legal help to get the issue resolved.

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2 hours ago, Teresa G said:

Wont they only take her part of the inheritance money to pay her debts?  why would we be liable to pay for it?

 

You resurrected an over six year old thread to ask a question that was answered six years ago.  WTF?

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