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  • #274196

    deNEpraNE
    Member

    My wife’s father has just passed and she’s trying to sort out his estate. I’m not in Brazil and I wouldn’t be able to help her with what she needs to do anyway.But, she said something today that I thought was strange and was hopping someone here could advise.
    Evidently, all the assets of her father get added up in value, including savings, and an estate duty is paid on the combined amount. I don’t know what the rate is. She said that before the estate can be finalised she has to pay the estate duty, and that could be months before everything is finalised. She’s worried that she can’t pay it. I asked her why that amount couldn’t be taken out of the proceeds of the estate when it was finalised, and she said it doesn’t work that way. Now, if she does pay it, that money will be reimbursed from that estate (I assume) but why can’t it be paid out from the estate itself? She won’t seek legal advice, as she says lawyers are far too expensive, so if there anything I can say to her that will get her to seek advice, or is there something she’s not aware of that would mean she doesn’t have to pay up front? Thank you. Any advice would be greatly appreciated.

  • #274201

    Andrewfroboy
    Participant

    You do have to pay the tax first, I unfortunately have experience with this. We had to scrap and scrape to pay it, including temporarily borrowing money from family. The tax is 3% in São Paulo if I’m remembering correctly. If you hire a lawyer to help you will expect to have them ask for a percentage as well. We did all the work ourselves and just paid a lawyer R$2500 to sign the document (it is a legal requirement for a lawyer to sign, gotta love the OAB [Lawyers Union]….).

    There are two ways to do an inventario, one is through a cartorio, the other the judicial system. If no one is fighting over anything and there are no minors involved, the cartorio is way faster and cheaper. We had everything resolved in less than a month I believe once we had gotten all our documents in order and paid the fee.
    My understanding was that if we needed to sell my sogra’s car for example to pay the fees we could’ve made a special request from a judge, but they do not allow you to do so without a special request.
  • #274202

    Andrewfroboy
    Participant

    Not counting the tax itself, we probably spent R$20,000 on documents, cartorios and lawyers and that was doing everything ourselves, but some of my sogra’s stuff didn’t have the paperwork sorted out so that might be why it was so expensive.

  • #274204

    Andrewfroboy
    Participant

    Best advice I have is to go to the nearest cartorio (i forget which kind of cartorio) and ask them for some help as ultimately they will decide for you. Our cartorio was very helpful with helping us figure out what we needed. I’d say we spent probably two months of work to have all the documentation.

  • #274218

    sven van ‘t Veer
    Participant

    Yes, you pay the tax first, which can be different from state to state. There is NO WAY she can do an “inventì°rio”. Even if all children of her father are adults, and they all agree, so it can be done in a Cartorio, a lawyer is requires.

    The cartorio process takes 3 to 4 months. First you pay the tax, then you send all the documents including the division to the Receita Estadual for homologation. That takes a month or two. Then you can take everything to the cartorio, but as I said, with a lawyer.
    If her mother is still alive and livin in the house, the home cannot be sold, so if there is just one home, and the mother lives there, and the amount in the bank account (half of it) doesn’t cover the value of the tax, she won’t get it back.
    The 2500 is a fair value for the lawyer, if you do all the legwork yourself. If it’s a court case inventory, be prepared to pay 5% of the value of the inheritance.
  • #274220

    Anonymous

    The sadness of deathcompounded by punitive taxes; it’s a little like the government saying, “Thankyou for contributing and don’t let the door hit you in the ass on your way out.”

  • #274221

    deNEpraNE
    Member

    [QUOTE=sven]Yes, you pay the tax first, which can be different from state to state. There is NO WAY she can do an “inventì°rio”. Even if all children of her father are adults, and they all agree, so it can be done in a Cartorio, a lawyer is requires.

    The cartorio process takes 3 to 4 months. First you pay the tax, then you send all the documents including the division to the Receita Estadual for homologation. That takes a month or two. Then you can take everything to the cartorio, but as I said, with a lawyer.
    If her mother is still alive and livin in the house, the home cannot be sold, so if there is just one home, and the mother lives there, and the amount in the bank account (half of it) doesn’t cover the value of the tax, she won’t get it back.
    The 2500 is a fair value for the lawyer, if you do all the legwork yourself. If it’s a court case inventory, be prepared to pay 5% of the value of the inheritance.

    [/QUOTE]
    It’s just her and her brother. There’ll be no contesting. Everything will be split 50/50. They have two bank accounts which are in three names; Her’s, her brother’s and her Father’s. It seems there’s enough money in those accounts that will cover the tax. Would I be correct in assuming that because the accounts are in their joint names that they will be OK to use those funds to pay the taxes? Also, would the accounts be split into three and only her Father’s 1/3 needs to be declared as his savings?

  • #274222

    deNEpraNE
    Member

    [QUOTE=Fila]The sadness of deathcompounded by punitive taxes; it’s a little like the government saying, “Thankyou for contributing and don’t let the door hit you in the ass on your way out.”

    [/QUOTE]
    Ha ha. As far as I’m concerned it’s getting too much. You work half of your day for that amorphous ever growing, ever intruding, entity before you can start earning money for yourself, and then they still suck what they can from you when you die.

  • #274225

    Anonymous

    [QUOTE=Badcam]

    It’s just her and her brother. There’ll be no contesting. Everything will be split 50/50. They have two bank accounts which are in three names; Her’s, her brother’s and her Father’s. It seems there’s enough money in those accounts that will cover the tax. Would I be correct in assuming that because the accounts are in their joint names that they will be OK to use those funds to pay the taxes? Also, would the accounts be split into three and only her Father’s 1/3 needs to be declared as his savings?
    [/QUOTE]

    Logic would suggest that abank account in three names is a joint and several responsibility meaning thatthe money is â‚ǨÀúowned’ by each name unless the account requires three signatureson cheques or other payments. Equally, any overdraft total would be theresponsibility of each of the account holders. Of course, if one were to engagein perverse logic, it could be argued that the whole sum is the father’ssavings. Good luck.

  • #274227

    sven van ‘t Veer
    Participant

    They can get the money out of the joint accounts without paying tax over it and use it to pay taxes on the real estate. These accounts dont have to be in the inventory, unless there is disagreement.

    Depending on what state you live in, I can do this for you for the price suggeted by andrew.
  • #274237

    Andrewfroboy
    Participant

    It is pretty crappy, especially when money is tied up in real estate. I think in most countries only the very rich pay estate taxes. I imagine a lot of people lose properties because they don’t or can’t pay or they don’t even know they have to.

  • #274261

    deNEpraNE
    Member

    [QUOTE=sven]They can get the money out of the joint accounts without paying tax over it and use it to pay taxes on the real estate. These accounts dont have to be in the inventory, unless there is disagreement.

    Depending on what state you live in, I can do this for you for the price suggeted by andrew.

    [/QUOTE]
    Thanks. She’s in Rio. I’m overseas at the moment.
    Can I get anyone else to confirm this? I wouldn’t like to tell her that she (and her brother) can use those funds to pay the ITD and then find out she gets in trouble for using those funds to do so, when she shouldn’t have done so. She’s considering cashing in a long term investment early so she can pay this bill. It would be nice if she didn’t have to as she will incur penalties for closing it early.

  • #274263

    Anonymous

    i can`t confirm this particular fact, but i can certainly vouch for Sven as a lawyer in two countries who knows his stuff. I think most of us have benefited from his wisdom, which for some unknown reason he doles out here for free.

  • #274264

    sven van ‘t Veer
    Participant

    [QUOTE=Badcam][QUOTE=sven]They can get the money out of the joint accounts without paying tax over it and use it to pay taxes on the real estate. These accounts dont have to be in the inventory, unless there is disagreement.

    Depending on what state you live in, I can do this for you for the price suggeted by andrew.

    [/QUOTE]
    Thanks. She’s in Rio. I’m overseas at the moment.
    Can I get anyone else to confirm this? I wouldn’t like to tell her that she (and her brother) can use those funds to pay the ITD and then find out she gets in trouble for using those funds to do so, when she shouldn’t have done so. She’s considering cashing in a long term investment early so she can pay this bill. It would be nice if she didn’t have to as she will incur penalties for closing it early.
    [/QUOTE]

    I’m a lawyer and I’m in Rio.
    They can use up to 50% of the money in the account to pay the tax. The other 50% must enter into the inventory (probate). This money must be shared and taxes must be payed on this 50%.
  • #274339

    deNEpraNE
    Member

    [QUOTE=sven]

    I’m a lawyer and I’m in Rio.
    They can use up to 50% of the money in the account to pay the tax. The other 50% must enter into the inventory (probate). This money must be shared and taxes must be payed on this 50%.

    [/QUOTE]
    Thanks Sven. One more question. Why not 2/3’s? The account is in three names. Her’s her Father’s and her Brother.

  • #274341

    Anonymous

    I get theimpression that this is being made up as it goes along. Money in a joint accountbelongs jointly and severally to the account holders; meaning that the contentsof the account belongs to each of the named account holders. e.g. If you have ajoint account with your wife, partner, mother-in-law, bi-polar lesbian maidenaunt or the local transvestite vicar, each and every one can go into the bankand legally clear out the account. I fail to see why, in the event of the vicargetting hand-bagged to death, any of the other account holders could not legallyaccess all of the money in its entirety.

  • #274342

    deNEpraNE
    Member

    [QUOTE=Fila]I fail to see why, in the event of the vicargetting hand-bagged to death, any of the other account holders could not legallyaccess all of the money in its entirety.

    [/QUOTE]
    This is exactly what I’m trying to confirm. Can they use the money in that account to pay for their fathers tax obligation, or not? If so, how much can they access from those, because there are two joint, accounts? All of it? 50%? Or two thirds?
    [QUOTE=Fila]I get theimpression that this is being made up as it goes along.[/QUOTE]
    Show me where my “story” has changed. What makes you think I’m making things up as I go along?

  • #274343

    Anonymous

    [QUOTE=Badcam][QUOTE=Fila]I fail to see why, in the event of the vicargetting hand-bagged to death, any of the other account holders could not legallyaccess all of the money in its entirety.

    [/QUOTE]
    This is exactly what I’m trying to confirm. Can they use the money in that account to pay for their fathers tax obligation, or not? If so, how much can they access from those, because there are two joint, accounts? All of it? 50%? Or two thirds?
    [QUOTE=Fila]I get theimpression that this is being made up as it goes along.[/QUOTE]
    Show me where my “story” has changed. What makes you think I’m making things up as I go along?
    [/QUOTE]

    Forgive me;it was not my intention to infer that it was your version being made up. Afterall, you have not changed any part of the description of your situation up untilthis, your last post, wherein you say that there are two joint accounts.Otherwise no offence intended.

    Fila2015-03-20 18:14:26

  • #274345

    deNEpraNE
    Member

    [QUOTE=Fila]

    Forgive me;it was not my intention to infer that it was your version being made up. Afterall, you have not changed any part of the description of your situation up untilthis, your last post, wherein you say that there are two joint accounts.Otherwise no offence intended.

    [/QUOTE]
    Prior post:
    [QUOTE=Badcam]
    It’s just her and her brother. There’ll be no contesting. Everything will be split 50/50. They have two bank accounts which are in three names; Her’s, her brother’s and her Father’s.It seems there’s enough money in those accounts that will cover the tax. Would I be correct in assuming that because the accounts are in their joint names that they will be OK to use those funds to pay the taxes? Also, would the accounts be split into three and only her Father’s 1/3 needs to be declared as his savings?
    [/QUOTE]
    No offence taken. I’d just really appreciate confirmation as to how much if any of those funds they can use to pay the tax. I don’t want my wife getting in trouble for assuming she could do something and only to find out later she can’t.

  • #274369

    deNEpraNE
    Member

    Is it true that you have to pay Estate Taxes on the deceased’s savings? I can understand the interest earnt prior to their death, and taxes on property owned, but their savings? And even any vehicles they owned?

  • #274373

    sven van ‘t Veer
    Participant

    [QUOTE=Badcam][QUOTE=sven]

    I’m a lawyer and I’m in Rio.
    They can use up to 50% of the money in the account to pay the tax. The other 50% must enter into the inventory (probate). This money must be shared and taxes must be payed on this 50%.

    [/QUOTE]
    Thanks Sven. One more question. Why not 2/3’s? The account is in three names. Her’s her Father’s and her Brother.
    [/QUOTE

    I understood that there where 2 accounts:
    1) father – your wife
    2) father – her brother
    If there are two acconts that are in the names of the three, then, indeed 2/3rds can be used.
  • #274374

    sven van ‘t Veer
    Participant

    [QUOTE=Fila]I get theimpression that this is being made up as it goes along. Money in a joint accountbelongs jointly and severally to the account holders; meaning that the contentsof the account belongs to each of the named account holders. e.g. If you have ajoint account with your wife, partner, mother-in-law, bi-polar lesbian maidenaunt or the local transvestite vicar, each and every one can go into the bankand legally clear out the account. I fail to see why, in the event of the vicargetting hand-bagged to death, any of the other account holders could not legallyaccess all of the money in its entirety.

    [/QUOTE]

    Yes, in the land of the living, each one can clean out the account. Things change however when one dies. Than each person has it’s legal share and the share of the person that died goes into probate.

  • #274375

    sven van ‘t Veer
    Participant

    [QUOTE=Badcam][QUOTE=Fila]

    Forgive me;it was not my intention to infer that it was your version being made up. Afterall, you have not changed any part of the description of your situation up untilthis, your last post, wherein you say that there are two joint accounts.Otherwise no offence intended.

    [/QUOTE]
    Prior post:
    [QUOTE=Badcam]
    It’s just her and her brother. There’ll be no contesting. Everything will be split 50/50. They have two bank accounts which are in three names; Her’s, her brother’s and her Father’s.It seems there’s enough money in those accounts that will cover the tax. Would I be correct in assuming that because the accounts are in their joint names that they will be OK to use those funds to pay the taxes? Also, would the accounts be split into three and only her Father’s 1/3 needs to be declared as his savings?
    [/QUOTE]
    No offence taken. I’d just really appreciate confirmation as to how much if any of those funds they can use to pay the tax. I don’t want my wife getting in trouble for assuming she could do something and only to find out later she can’t.
    [/QUOTE]

    I guess it’s my bad. I read incorrectly. I read her brother’s her fathers and her’s and her her Father’s.

    I was in a hurry.
  • #274379

    Fernandez
    Member

    Also Sven please be very clear about accounts with joint signers vs jointly titled accounts. Wouldn’t the probate process be very different in each case?
    ferrar2015-03-22 13:14:08

  • #274382

    deNEpraNE
    Member

    [QUOTE=Badcam]
    Thanks Sven. One more question. Why not 2/3’s? The account is in three names. Her’s her Father’s and her Brother.
    [/QUOTE]

    I understood that there where 2 accounts:
    1) father – your wife
    2) father – her brother
    [QUOTE=sven]
    If there are two acconts that are in the names of the three, then, indeed 2/3rds can be used.

    [/QUOTE]
    [QUOTE=ferrar]Also Sven please be very clear about accounts with joint signers vs jointly titled accounts. Wouldn’t the probate process be very different in each case?
    [/QUOTE]
    I think perhaps I need to be clear on that too. The accounts are in all three names, but my wife tells me that her father was “declaring” the income from those accounts, or at least that it was his Tax Number that was associated with the accounts. I don’t beleive they were sharing the interest out in terms of declaring tax while he was alive. Sorry, but I’m o/seas and my wife although her english is impeccable, my portuguese is limited, and she’s finding it difficult to express to me the information I need to give to you in a way that I can help you understand.
    So, I’m assuming that all of the savings will be classed as part of his estate, and estate duties will be paid on his property AND all of the savings (I don’t like that personally; that sounds wrong), BUT they can use his savings to help pay the taxes he’ll be owing.
    Does that sound correct?

  • #274384

    sven van ‘t Veer
    Participant

    No. Duties will be payed only on one third of the money in the account in the accounts, as they are joint.
    Ferrar, it makes little difference if the accounts are “and/or” or only “and”. The “and” version only means that they can only jointly sign for the account. For estate proposes, the money belongs equally to each part.
    Estate tax is only payed on the part legally owned by the coowner that died. 1/3rd in this case.
    Whether estate tax is due depends on the amount, and may depend from state to state. I’ll check the relevant state law tomorrow if I have the time.

  • #274396

    Fernandez
    Member

    [QUOTE=sven]
    Ferrar, it makes little difference if the accounts are “and/or” or only “and”. The “and” version only means that they can only jointly sign for the account. For estate proposes, the money belongs equally to each part.
    [/QUOTE]
    Just having operational authority to move the account via a signature card does not convey ownership. One would have to be included in the account title for that. The issue is signing authority vs account ownership – wouldn’t that matter for probate?
    ferrar2015-03-22 21:00:37

  • #274397

    deNEpraNE
    Member

    I finally got the wife to listen. Shock horror. She’s given me this to post here:
    “eu pai faleceu em marìßo de 2015; Para fins de inventì°rio, como faìßo para declarar uma conta conjunta entre meu pai, eu e meu irmão a fim de calcular o imposto de transmissão.
    Posso considerar apenas um terìßo dos valores constantes da conta conjunta, incluindo as aplicaìßìµes financeiras, mesmo se apenas o meu pai declarava isso na declaraìßão do imposto de renda?”
    Can someone please translate this for me?

  • #274402

    Andrewfroboy
    Participant

    “My dad passed away in march of 2015. For the purposes of resolving his estate, how do I declare a joint account with my dad, myself and my brother in order to calculate the tax we need to pay. Can I consider just a third of the value in the join account, including our financial investments, even if only my dad declared them on his income tax declaration.”

  • #274411

    sven van ‘t Veer
    Participant

    You can reply this to her:
    “Sì≥ deve recolher imposto sobre 1/3o da valor na conta no momento do falecimento, desde que ì© superior a R$ 13559.50 ume vez que este valor ì© isento.”

  • #274413

    sven van ‘t Veer
    Participant

    [QUOTE=ferrar] [QUOTE=sven]
    Ferrar, it makes little difference if the accounts are “and/or” or only “and”. The “and” version only means that they can only jointly sign for the account. For estate proposes, the money belongs equally to each part.
    [/QUOTE]
    Just having operational authority to move the account via a signature card does not convey ownership. One would have to be included in the account title for that. ¬†Â¬† The issue is signing authority vs account ownership – wouldn’t that matter for probate?
    [/QUOTE]
    For (estate) taxation purposes the money belongs to each an equal share. If not, if all three died at once, it would be taxed three times.

  • #274419

    Fernandez
    Member

    [QUOTE=sven] [QUOTE=ferrar] [QUOTE=sven]
    Ferrar, it makes little difference if the accounts are “and/or” or only “and”. The “and” version only means that they can only jointly sign for the account. For estate proposes, the money belongs equally to each part.
    [/QUOTE]
    Just having operational authority to move the account via a signature card does not convey ownership. One would have to be included in the account title for that. The issue is signing authority vs account ownership – wouldn’t that matter for probate?
    [/QUOTE]
    For (estate) taxation purposes the money belongs to each an equal share. If not, if all three died at once, it would be taxed three times.
    [/QUOTE]
    Are you sure about this? It should be taxed once. To the sole account owner. In this hypo example the account is titled in one person’s name, with two other persons having operational authority to move the account via signature cards.
    ferrar2015-03-23 21:09:57

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