"Can an Estate Executor loan money to the estate?"?
- babyboomer1001Lv 71 month ago
Whatever for? I don't see any point in doing that or any need. Why complicate things?
- curtisports2Lv 71 month ago
Yes. However, the executor takes a risk in doing so. The loan cannot be repaid to the executor before certain estate debts are paid in full. To ensure being repaid, the executor will usually only make a loan when there is a short-term need for cash (to pay for those things that come first, such as burial/cremation costs, government taxes, debts owed by the deceased, and ongoing costs of real estate owned by the deceased). When there are sufficient assets to leave the stated inheritance, but liquidating those assets takes time.
When an executor of an estate with many non-liquid assets is strapped for cash, they can find themselves having to sell some of those assets at fire-sale prices to get a fast sale and fast cash. Making a loan to the estate makes sense in such a case.
- 1 month ago
Yes he can. Estates are often illiquid and this can solve a short term cash flow issue. For example in the UK inheritance tax(IHT) has to be paid before the estate can come out of Probate. It is therefore not uncommon for the executor to lend the estate the money to pay the IHT, complete Probate and then reimburse himself.
- MattLv 51 month ago
I would say no but I could be wrong