Author Topic: Probate Frustrations: Father's Penny Stock  (Read 1145 times)

leighb

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Probate Frustrations: Father's Penny Stock
« on: October 26, 2016, 08:37:32 PM »
About 2 years ago my father passed. He left my sister and I his estate, split 50/50. My aunt is the executor and his friend is the lawyer.

At his time of death his estate was valued at about 2.3mil. But here's the issue. About 1.7mil was in one penny stock! He was a major shared holder of this stock +5% held, and I think was supporting this stocks or was maybe taken for a ride. After his death the stock slid and slid. It was never liquid and now is delisted, so probably worthless. So while that all sucks, it is now creating a new level of complications.

My Aunt and the lawyer are valuing the estate at the inflated (time of death) value to determine what they are owed by the estate. There's a formula using percentages of assets to determine that the estate owes about $160,000. They are okay taking 50% of that amount. Which I guess is nice, right? Regardless, a bill for 75,000 for an inheritance that in reality was closer to $600,000 still seems like a lot. Maybe I was expecting a friends and family discount and have no idea that this is completely fair.

We've made it through this process with no arguments, but man this just isn't sitting right with me. On one hand, I want to continue to have good relationships with both of these people. On the other I do not want to be taken advantage of.

Here are a few of my questions,
1) While I get that they might be doing this probate thing correctly, is this fair? I should drop this. This is in fact how this stuff works out. It sucks but oh well...
2) Has anyone argued successfully that the value of an inheritance is incorrect?
3) Personally, would you continue to be in business with either my aunt or this lawyer in the future? I ask because I am and this is making me question that relationship.

Vagabond76

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Re: Probate Frustrations: Father's Penny Stock
« Reply #1 on: October 27, 2016, 04:44:35 AM »
You can try to challenge the valuation of the estate. You might have better luck challenging the executor's handling of the estate, as she allowed the value to decrease by three-quarters. An executor has a fiduciary relationship to the beneficiaries.

These issues, as well as personal ones in my family, really drive home the need to protect oneself from one's future self. The audience here tends to be younger and from families that did not have much wealth. Many don't seem to understand how easy it is for old people to slowly fade away mentally and get taken for a ride--either from unscrupulous "investment" pushers or from manipulative family members.