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How can I, as successor trustee of my brother's estate, take equity out of his former home to pay his tax debt to the IRS?

Hayward, CA |

My brother passed away leaving his house in Nevada as the only living trust asset of value, and a debt to the IRS. The trust beneficiaries, his son and family, now live in the house, are paying its mortgage, and want to keep it. There is enough equity in the house to pay the IRS debt. The IRS will seize and sell the house if the debt is not paid. So my nephew and his family can stay in the home, the only other option I see is to take money out of the house (HELOC, refi, 2nd mortgage) to pay the debt. My nephew and his wife are unlikely to qualify for a loan. I do not want personal liability. Without selling the house, how can we take money out of the house to pay the debt?

Attorney Answers 3

Posted

Look at the will to determine your powers as executor. You can likely take ann equity line on the property to pay what is owed.

This answer is based on general legal principles only and is not intended to provide specific legal advice. This answer is for informational purposes only and does not constitute the formation of a lawyer-client relationship. Any reader of this answer should not make decisions based upon in without first directly consulting with an attorney

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Posted

Attorney Sayed has offered a good suggestion.
Have an attorney review the trust to see if you have the power to take an equity loan.
You do not have to be personally liable.

The answer given does not imply that an attorney-client relationship has been established and your best course of action is to have legal representation in this matter.

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Posted

You have a personal obligation to pay the IRS. If the debt is not paid, the IRS can come after your personal assets. That is a situation you do not want to face. Therefore, you are obligated to sell or refinance the asset to pay the debt. It's a tough situation, but you did not create it: your brother did. If your nephew won't cooperate, you may need an order from the Probate Court. But do not let this go or you will be sorry.

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