Dear Penny: I Don’t Think My Brother is Handling Mom’s Estate Fairly. Help!
My mother passed away five years ago. My brother and I were to each have 50% of her estate. I am the oldest. Her estate included her house, my grandmother's house and a couple of life insurance policies. There was a hearing that I didn’t realize was important because I thought it was just verifying the equal 50/50 division. I didn't realize that the hearing also made my brother the executor of the estate, which I guess makes him the one who can distribute everything.
I have not seen any receipts or paperwork on anything. He says the money from my grandma's house went to cover a new roof and other repairs on my mom's house. The bottom line is he has gotten $95,000 and I have gotten only $45,000. This isn't fair. What should I do now — choke it down or do I have any recourse?
— Half an Heir
You’re correct that being the executor of the estate means your brother is responsible for distributing your mother’s assets. It also means he’s responsible for carrying out any other wishes laid out in a will, and closing out legal and financial affairs, like paying off debts, closing accounts and filing final tax returns.
I’m sorry for your confusion with the hearing. These processes are overly complex, and our legal and financial systems aren’t good at guiding people through them. Your question requires a legal expert much more than a financial expert, so I asked a few attorneys for their take. (None of this constitutes individualized legal advice, and you’ll need to consult an attorney in your state to learn more about your situation.)
“We see many families that have an ‘understanding’ of how things are to be distributed upon a loved one’s passing,” said Kimberly A. Hegwood, Owner & Managing Attorney at Your Legacy Legal Care, “but if the estate planning documents are drafted a different way, then typically the legal documents will control the distributions.”
In the case of the insurance policies, your mother would have had to list beneficiaries when she signed up for the policy, so those should say explicitly how the payments will be distributed. If you’re listed as a beneficiary and haven’t received your share of those benefits, contact the insurance provider first to determine why, and consult an attorney to figure out your legal recourse if that doesn’t help.
For the other assets, if there was a will, the executor has to carry out its wishes and can’t withhold any inheritance you’re due. However, it sounds like your mother might not have left a will spelling out how those should be distributed. In that case, the executor can choose how to distribute assets, but many attorneys I asked mentioned there’s often an assumption of an equal split unless your brother has reason to believe your mother wanted otherwise. Your brother is responsible for carrying out your mother’s wishes, so you’ll have stronger recourse if you have written or recorded evidence that she wanted a 50/50 split, even if it wasn’t in a will.
That’s no guarantee, though. Travis Christiansen, Attorney at Boyack Christiansen Legal Solution, warned, “You can challenge it, but this may cost you more time and money and a relationship that you aren’t willing to lose.”
Before bringing a legal challenge, Benjamin Inman, Attorney at Inman Law, said, “I look for innocent explanations and attempt to disprove them before jumping to the conclusion that someone is stealing money.”
It’s common for an executor to be compensated for the work it takes to manage the estate, which could be why your brother has a larger portion of the estate. You could have a conversation with him to agree on a fair amount for that compensation.
If you want to consult an attorney, you can find someone based on your available resources through nonprofit legal aid organizations, online directories like Justia, or local bar associations in your city or state. Opening a case might at least force your brother to provide receipts for how he’s used the money from the inheritance, so you know exactly what’s gone into his pocket and what’s gone toward other expenses.
Christiansen added, “The attorney may also be able to act like a mediator to assist with a difficult conversation with your sibling without going to court, but you should be prepared that court might be the only way to resolve it.”
Dana Miranda is a Certified Educator in Personal Finance®, author, speaker and personal finance journalist. She writes Healthy Rich, a newsletter about how capitalism impacts the ways we think, teach and talk about money.