“Estate sale companies simplify what can be a tough time for many, whether it’s downsizing, disability, or death in the family,” Fox 59 reports. When someone has died, the administration of an estate requires that debts and expenses be paid first, with the beneficiaries receiving their share from what is left, Alexander Bove, Jr., author of The Complete Book of Wills, Estates, & Trusts explains. If the estate includes real property, such real estate is not sold to pay final expenses until the cash and personal property are used up. Sometimes specific items of personal property are named to go to specific heirs. What the estate sale is designed to do is convert the non-allocated personal property (“stuff”) into cash.
As estate planning attorneys, we encourage our clients to create specific instructions for the distribution of tangible items to individual family members or other heirs. There are several reasons why having a plan for disposing of tangible personal property is highly important:
- Tangible items often have sentimental value far in excess of actual value.
- The sheer number of tangible items makes it time-consuming for the executor to settle the estate.
- When tangible items are held inside containers (boxes, desk drawers, safes) a gift of the entire contents of a container can be confusing when cash or stock certificates – which are governed by different probate rules – are held there.
- Computers are part of tangible personal property, but the digital assets (the data contained on that computer’s drives) must be dealt with separately.
TV news featured one very big estate sale in 2015: “After years of privacy, one of Indianapolis’ most famous homes, the Kessler Mansion, is opening to the public,” Channel 13 shared. “Items up for sale included outdoor statues, artwork, linens, high end furniture, lamps and lighting, glassware, firearms and ammunition, and home décor.”
“Privacy” is an important word in this announcement, because an estate sale, by definition, is very public. While having a professional company handle all the details of selling items in an estate relieves mourning family members from all the minutiae, family privacy is certainly sacrificed in the process.
It’s important to understand, too, the difference between tangible and intangible property. Property itself includes anything capable of ownership, the author of Wills, Estates & Trusts explains, and all property is divided into two basic categories: real and personal. But person property is not all alike:
Tangible personal property includes things that can be moved and touched, while intangible personal property includes things that in themselves have no value, but which represent the right to something else. Examples of intangible personal property include:
- a copyright
- a royalty interest
- a promissory note
Estate sales and auctions are two methods of liquidating tangible property after the owner has died. According to fineestateliquidation.com http://fineestateliquidation.com/estate-sale-or-auction/, some advantages of holding an estate sale as compared to consigning the goods to an auction house include:
- Everything takes place in one central location, with no moving charges
- Each item can be individually priced
- Advertising includes only this estate (rather than being listed as only one part of an auctioneer’s catalog
Two disadvantages include:
1. lack of privacy (there will be strangers in the decedent’s house)
2. potential liabilities (for harm done to the goods or accidents happening to visitors – the estate sales company should carry special insurance for this very purpose).
Estate sales obviously have pros and cons, but can offer a way to simplify the handling of assets at a very challenging time for a family.