A deceased estate comes into being when a person dies. The deceased estate consists of the heirs of the deceased estate and the deceased's assets and debts.
Expenses can arise for the estate even after a death. Such expenses can include, for example, the deceased's potential hospital and electricity bills. In addition, funeral costs will remain as estate expenses. Therefore, costs related to the inventory and settlement of the estate will remain for the estate. Further expenses can also arise from the management of the estate, as well as the division of the estate's assets.
The deceased's lifetime expenses should be separated from the estate settlement debts incurred after death. These are two different things. The question then arises as to who is responsible for these estate expenses.
As a general rule, the costs of administering the estate are paid from the estate's assets and have priority over debts incurred by the deceased during their lifetime. This priority can be justified by the fact that the estate's other debts would not even be settled without the mandatory costs of administration. Therefore, the costs of administering the estate are paid first from the estate's assets, followed by the deceased's other debts. Only after all debts have been paid is the estate ready for distribution.
Expenses of an undivided estate
Joint administration of an estate means that actions concerning the estate are taken jointly and unanimously by all beneficiaries. Consequently, the sale of the estate's assets or the payment of its debts requires the consent of all beneficiaries, regardless of how minor the action may seem.
The payment of expenses from an undivided estate will become the responsibility of the estate shareholders to agree among themselves unanimously.
How much can the property expenses of an estate be?
A deceased person's estate can include real estate. The real estate incurs costs for the estate, which the deceased is no longer able to pay. The beneficiaries of the estate should agree on how to cover these costs through joint administration, meaning by unanimous decision. The decision will cover whether the costs are paid from the deceased's account or if there is another method by which the expenses are covered.
The costs of a property can be substantial, for example, if the property requires maintenance or upkeep.
It is noteworthy that the decision to cover the expenses of the deceased's estate's property must be made unanimously.
