Posted on 08/20/2014 12:55:18 PM PDT by Cementjungle
RANT!
It's a frustrating situation to have in your hands a check from the US Treasury for over $141,000 and you can't do a darned thing with it except frame it and hang it on the wall as a souvenir.
My MIL passed away in 2011, and my wife (as the only surviving relative) was named in the will as the executor of the estate and successor to the trust. The will was filed with the courts in L.A. and the long process began.
We paid the IRS $240K the first year in estimated estate taxes along with a request for an extension. The next year we filed the 706 and were refunded $68K. My wife transferred her mom's properties into her name and sold them, dealt with bank accounts, IRA and other investments.
Last year we get a notice from the IRS that the estate filing had been chosen for an audit... so we did all the work involved in that. The IRS attorney wound up REDUCING the estate and then finally (recently) issued her a check for over $141K. Great... except the check is useless.
The check is made out to my wife (on line one) and on line 2 it says (Estate of..... her mom's name). Our banks (Chase and B of A) will not touch the check because there's no account with the name of "Estate of XXXXXX". We showed them the will naming her as executor, the trust agreement, the IRS estate filing, the subsequent tax filings for her mom's trust, the correspondence with the IRS that led to the refund.
No go... since this was a trust there was no probate court... but the banks insist on a letter from a probate court. We can't probate the estate because the estate has already been properly settled.
We called the IRS attorney... he was very nice, but said there's nothing they can do.... and this happens a lot. He says you just have to keep trying different banks until you can find one that will take the check.
Anyone here have any experience with this sort of thing?
Try East West Bank. I think they are headquartered in CA. I have had an account with them for years. They are a Chinese owned commercial bank out of Hong Kong. Lets just say they are flexible sometimes.
Without pretending to give you legal advice, the IRS atty is correct. You just have to find a cooperative bank and it may take a while. We had a trust situation and the brokerage where my Dad/folks had been for 20+ years had a problem with something or other similar to this topic. Aka “’titling’” on a remittance instrument”.
We (my brother included, who is an attorney but not an estate attorney for 40+ years) showed the brokerage the trust, including the original notarized copy, he wrote a letter, we showed them my folk’s underlying will.....and they still would not do what we wanted which was utterly normal.
My Dad was 92 at the time, so at that age, you never know what might happen. He was reasonably cogent but it was dicey whether he would pass as such from a notary. (Had he become non-competent during this transition period, that would have been $50K++ in fees to get that fixed as far as him making a change in the trust, so we were quite freaked out, to say the least) We worked with the brokerage for 2 weeks with no luck, meanwhile looking for another who *would* execute the terms of the trust. On the day we decided to exit the brokerage we just did. We ACH’ed the contents of the brokerage account and ten or so days later, all the contents had landed at the new brokerage.
You sound like you understand more than normal amount of stuff about the trust, etc; but you are probably going to have to get with an attorney (and not just any atty, a genuine estate/trust atty) and have him/her negotiate with the bank, but you can present your story to the bank (more specifically, the banks legal department) and it is possible in the worst case that you might have to purchase a bond to guarantee the validity of the remittance and the endorsement. And it might cost you 10% of the corpus plus a few grand for the atty.
My advice would be to on your own seek face to face with people in the legal depts of prospect banks and see if you can develop personal rapport an an algorithm as to what specifically they would require-—before you hire an atty.
Not legal advice!
Just get a local bank that is not a chain or have your lawyer deposit it in a trust account and then cut you a check.
When you had the first check (and/or disposed of other assets), did your wife have to present a letter from the court to show that she was authorized to act on behalf of the estate? That letter might be public record, and you may be able to call the clerk of the court in the jurisdiction where it was issued, ask for a certified copy. Then take that to the bank with the new check. ??
Subject : IRS REFUND CHECK
FROM THE OFFICE MR SULEMAN BELLO
AFRICAN DEVELOPMENT BANK (ADB).
OUAGADOUGOU BURKINA FASO.
WEST AFRICA.
I AM SULEMAN BELLO, THE AUDITOR GENERAL OF AFRICAN DEVELOPMENT BANK HERE IN BURKINA FASO. I THINK THAT WE MAY BE ABLE TO HELP ONE ANOTHER OUT OF EACH OTHER FINANCIAL PREDICUMENTS. DURING THE COURSE OF OUR AUDITING, I DISCOVERED A FLOATING FUND IN AN ACCOUNT OPENED IN THE BANK BY MR JOHN KOROVO AND AFTER GOING THROUGH SOME OLD FILES IN THE RECORDS I DISCOVERED THAT THE OWNER OF THE ACCOUNT DIED IN THE (BEIRUT-BOUND CHARTER JET) PLANE CRASH ON THE 25TH DECEMBER 2003 IN COTONOU (REPUBLIC OF BENIN).
AND NOBODY HAS OPERATED ON THIS ACCOUNT AGAIN, THE OWNER ……..
This attorney is at least aware of the all the antecedent events and wouldn't necessarily regard this request as "fishy." At the very least, the attorney could point you in the right direction.
Best of luck!
Nope... she was able to do everything without any letter from any court. Transferred title of two properties in L.A. and sell them, sell a partnership which owned a commercial property in TN, take over bank accounts and investment accounts, deal with the Motion Picture Academy on an issue involving a film (Academy Award nominated documentary) her mom made, deal with artworks that were on loan to various museums, etc.
Taxes were all paid out of her mom's trust account... the IRS doesn't care who sends them money. Payroll issues with L.A. and CA for employees of her mom's were dealt with, business licenses, and so on.
OK they she must have been the trustee, and everything was held by the trust.
I would suggest to call the probate court in the jurisdiction of the death, and ask them what is needed and how can you do this without an attorney (don’t tell them the check is significant). There is probably a form that needs to be filed with the court, along with the death certificate, and I don’t think you (your wife) needs to go there to do this.
We opened an estate account when my grandfather died. Just to make things cleaner in the paperwork.
He just called back and will resurrect an old trust account that my MIL had and will allow the deposit into that account, then distribute the funds to my wife. Yea!
Now... we're going to enjoy marching into Chase and B of A and yanking our stuff away from those suckers... once we find someplace better.
It could have been worse. It could have been a check for $15,800,000.
Think you could loan me a fiver until payday?
Too many people know about your windfall. ;)
/johnny
My opinion on this though is that once you have the court order, whichever clerk you are dealing with at the bank will kick it to their legal dept and the attorneys in the legal dept will direct the clerk to cash the check rather than be in violation of a court order.
That's an even better idea. BTTT.
It's no windfall, since it's just a refund for our prior OVERPAYMENT of estate taxes.
The bulk of the estate is unsold artwork, which may or may not eventually sell. We had to shell a lot out of our own pockets to settle this darned estate in the first place.
Want to buy some nice artwork?
/johnny
I did another $200 about a month or so ago... will likely do more again when I clear a zillion of other things off my desk. We just got back from an African safari Sunday night!
GOOD! I am glad you found a resolution, now donate a few bucks to Free Republic for all the great advice you received! :-)
/johnny
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