After beloved Black Panther actor Chadwick Boseman died of colon cancer at the age of 43 in August 2020 without a will, his family settled the distribution of his estate amicably. They agreed to distribute the US$2.3 million (about S$3.1 million) estate in accordance with the law – half of the estate went to his widow Taylor Simone Ledward, while his parents, Leroy and Carolyn Boseman, received the other half.
As a piece for NBC News’ THINK opinion section by Christina Wyman reminds us, while the Boseman family settled his estate honourably, they remain an exception rather than the norm. According to Wyman, more often than not, family members or even strangers step out to fight for a piece or a larger slice of the deceased’s assets. This can happen even if the estate of the deceased is small.
That is why estate settlement can be stressful for the loved ones of the deceased. To better deal with complications that could arise in the process, it is helpful to equip yourself with a broad understanding of what it involves, and to encourage your families and relatives to be similarly informed. In this article, we bring you though three key questions to address when settling the estate of a loved one.
Question 1: Does The Deceased Have A Will Or A Trust?
Whether the deceased has left a valid will, had set up a trust when he was alive, or had made a trust that takes effect after his or her death, has a bearing on the process of settlement that cannot be overestimated. The differences begin at who can be given the legal rights to manage and distribute the deceased’s estate, and extend to the speed and the cost at which this legal representative can do so.
Let us take a walk through a hypothetical example. Leonard died at 37 with an estate just above S$250,000, a valid will and no trust. He appointed his brother, Peter, to be his legal representative to administer his estate on his behalf (known as the executor where there is a will). After Peter applies for and is issued a grant of probate, he will be able to distribute Leonard’s assets. If Leonard had no will, Peter might not be able to successfully become the legal personal representative on Leonard’s behalf to manage his estate (known as the administrator where there is no will). Even if he is successful in his application to the court, he would likely have to find someone with assets the size of Leonard’s estate to act as a surety (guarantor).
Question 2: What Type Of Assets Did The Deceased Have?
The actions that the executor or administrator needs to take can vary when it comes to different asset types, which can comprise bank account balances, insurance claims and benefits, CPF savings, residential and commercial properties, and vehicles. For a helpful – but not universal – list of assets the deceased might have, please refer to this Checklist of Assets by the Government or read through our guides to Estate Settlement via Testacy (with a will) and Estate Settlement via Intestacy (without a will). One asset type that can cause a complex and prolonged estate settlement is property. This is especially the case when the joint tenant of a property is not the same person as the beneficiary of the property as stated in the deceased’s will. This was the case for three siblings, who went to court over properties worth $3.1 million in July last year because the eldest son had joint tenancy of properties willed to the youngest child, according to Lianhe Wanbao and as carried in Mothership.
Question 3: What Are The Outstanding Liabilities That Need To Be Cleared?
Once the assets within the estate and their market value as at the date of death have been laid out, there is a need to list out and clear the deceased’s outstanding liabilities. This needs to be done before the estate’s assets can be given out to the beneficiaries.
Besides more straightforward liabilities to settle, such as mortgages, credit card debts, as well as car and personal loans, there are more tricky liabilities to deal with, including taxes. If the deceased had multiple income streams from trade, businesses, properties, investments, royalties and more, the executor or administrator will need to settle all tax matters, keeping in mind that all income earned by the deceased up to the date of death is subject to income tax.
For more specific insights on different aspects of estate settlement, please visit https://estateplanning.com.sg/estate-settlement/.
This article and the pages it links to are not substitutes for professional advice. For specific advice on an estate settlement in which you are involved, please contact the team at Summit Planners.
- G Raman. (2012). Probate and administration in Singapore and Malaysia. Singapore Lexisnexis.