When it’s time to close an estate, there’s an informal option available for settling the estate in Pennsylvania called a Family Settlement Agreement. Typically, the Executor of an estate will request a release of liability (Family Settlement Agreement) before distributing the estate assets. This agreement acknowledges that the Executor has carried out their duties for the estate. In addition, it removes the need to prepare and attend formal court proceedings with the Orphans’ Court who will audit the entire estate, which is costly and timely.
Continue reading to learn more about the estate Family Settlement Agreement in Pennsylvania.
What is an Estate Family Settlement Agreement in Pennsylvania?
When it’s time to close a Pennsylvania estate, the Executor has the option to prepare a Family Settlement Agreement. This option is the most straightforward way to close an estate since it doesn’t involve any judicial proceedings. However, all the beneficiaries must agree to sign the contract in order to move forward since it binds all signees to it. Once they decide to sign, then a lawyer can create the agreement.
If you would like to have this agreement, an Estate Planning Law Firm, like Auld Brothers Law Group, can draft, circulate, and have all parties sign it for you.
Estate Family Settlement Agreement Requirements
An estate Family Settlement Agreement in Pennsylvania should include all the details of all the estate distributions and payments. It helps to protect the Executor from potential claims from the estate heirs. Although the contract is a legally binding document, it doesn’t always prevent heirs from pursuing other claims against an estate.
Additionally, it’s important to note that this option isn’t available if unpaid creditors are still associated with the estate. Potential creditors could include the PA Department of Revenue and the IRS. As the Executor, you need to pay all debts before distributing the remaining assets.
What if Heirs Don’t Sign an Estate Family Settlement Agreement?
There are situations where the estate’s heirs refuse to sign the Family Settlement Agreement. If this occurs, you’ll need to close the estate by filing an Accounting and Petition for Distribution with the local county Orphans’ Court. Before attending court, you’ll need to legally explain how all the estate assets and expenses will be distributed.
If there are objections to the breakdown, the judge will set a date to hear them before proceeding forward.
If all the heirs agree to the breakdown, you can file a Petition for Adjudication. The court will review and determine if you can make the distributions. Once approved, the Executor can pay the bills and debts and distribute the remaining assets to the beneficiaries.
Work with the Most Preferred Pittsburgh Estate Planning Lawyer
A Pittsburgh estate planning lawyer can create an estate Family Settlement Agreement in Pennsylvania for you and so much more. They can help you navigate any part of the Probate process or help you from start to finish.
Learn why Rebecca A. Auld of Auld Brothers Law Group is a trusted estate planning lawyer in Pittsburgh. For over 100 years, Auld Brothers Law Group has served the Pittsburgh area with three generations of attorneys. Rebecca’s father has guided her throughout her career, and now she’s available to help you. She provides several Probate and Estate Administration services for your specific situation.
Are You Ready to Get Started?
Contact Rebecca today to learn how she can help you with your Family Settlement Agreement and more.