McDonald Warner - Probate, Elder Law, & Special Needs

Handling hard assets in an estate plan

Over the years, many Arizonans acquire property for their own personal enjoyment. Items such as jewelry, artwork or other sorts of collectibles are some examples. In some cases, these hard assets may have substantial economic value. However, their monetary worth may be unknown. During the estate planning process, these items should be treated and assessed differently than liquid assets such as cash in a bank account.

Professional financial advisers recommend a three-pronged approach to hard assets. One should determine the asset's worth, who wants the item and the best way to accomplish the transfer. The appraisal of the asset should be conducted by a certified expert in the specific field and must be current. People should not rely on a previously made appraisal from years past.

If none of the potential heirs seems to have an interest, it may be more appropriate to sell the asset and gift the cash. If more than one heir appreciates the value, it may be possible to divide the asset or provide the opportunity for an equitable buyout among those who show interest. The heir or heirs receiving the asset will receive a stepped-up basis in the asset to reflect its fair market value as the date of death. It's also possible to place the asset in a trust to provide future generations with a benefit.

By completing the estate planning process now, one could obtain peace of mind down the road and facilitate an easier transition for the family when the inevitable occurs. An estate planning attorney can provide guidance and advice throughout the process.

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