Detailed Answer
After a decedent’s death, the personal representative must determine which assets remain after paying debts, fees, and expenses. In New Mexico, the process follows these steps:
1. Compile a Complete Inventory
List all probate assets, including real property, bank accounts, investments, personal property, and business interests. Use fair market values as of the date of death. File this inventory with the probate court.
2. Identify and Calculate Debts and Obligations
Include funeral and burial expenses, administration costs, attorney fees, court costs, taxes, and creditor claims. Review the payment priority rules in NMSA 1978 § 45-3-801.
3. Follow Payment Priorities Under NMSA 1978 § 45-3-801
New Mexico law sets a strict order for paying claims:
- Funeral and burial expenses
- Administration expenses, including personal representative fees, attorney fees, and court costs
- Family allowances
- Federal and state taxes
- Other debts and claims
View the statute: NMSA 1978, Section 45-3-801.
4. Subtract Debts and Expenses from the Gross Estate
Subtract the total of all debts, taxes, and administrative expenses from the gross value of estate assets. The result equals the net or residuary estate.
5. Verify and Distribute the Remaining Assets
Confirm that all obligations are paid or properly reserved. Distribute the residuary estate according to the will or, if there is no will, under intestacy rules in NMSA 1978 § 45-2-103.
View intestacy rules: NMSA 1978, Section 45-2-103.
Disclaimer: This article provides general information and does not constitute legal advice. Consult a qualified attorney for guidance on your unique situation.
Helpful Hints
- Document valuations with appraisals or bank statements.
- Keep detailed records of all payments and receipts.
- File creditor claims on time according to court deadlines.
- Consult a probate attorney for complex estates or disputes.
- Review estate tax obligations at both state and federal levels.