How to Distinguish a Deceased Person’s Estate Assets from Corporate Assets in New Mexico
Detailed Answer
New Mexico law treats a deceased person’s estate and a corporation as distinct legal entities. The estate collects and distributes assets owned in the decedent’s name. A corporation holds assets in its own name for its shareholders or members. To distinguish between these asset pools, you must examine how each asset is titled, who controls it, and the governing documents behind it.
1. Review Title and Ownership Records
Check public records for each asset. Real estate deeds, vehicle titles and bank account statements list the named owner. If the decedent’s name appears alone or with a trust designation, the asset belongs to the estate. If the asset bears the corporation’s name, it belongs to the corporate entity.
2. Examine Corporate Documents
Under New Mexico’s Business Corporation Act, a corporation stands alone as a separate legal person (NMSA 1978, Chapter 53). Review the articles of incorporation, bylaws and minutes. These documents identify corporate officers and directors authorized to buy, sell or manage corporate property. Any asset acquired or held by the corporation in its name is corporate property, not estate property.
3. Analyze Account Ownership and Tax Filings
Bank and brokerage accounts often display the name of the account holder. Corporate accounts carry the corporation’s taxpayer identification number (EIN), while personal accounts use the decedent’s Social Security number. Review the decedent’s final federal and state income tax returns. They list personal income and may report estate assets (NMSA 1978, Chapter 7).
4. Check Probate Filings and Personal Representative Actions
When you open probate in New Mexico, the personal representative lists all probate assets in the inventory (Uniform Probate Code, NMSA 1978, Chapter 45, Article 3). The listing identifies assets held in the decedent’s name. Corporate assets do not appear unless the decedent personally owned shares or membership interests.
5. Identify Shareholder or Membership Interests
If the decedent owned shares in the corporation, those shares form part of the estate. You will inventory stock certificates or membership interests, not the corporate assets themselves. The personal representative steps into the decedent’s shoes as a shareholder or member, while the corporation continues to hold its own assets.
Helpful Hints
- Obtain certified copies of deeds and titles to confirm recorded ownership.
- Request corporate record books from the registered agent to verify asset transactions.
- Review bank statements for account numbers and tax ID details.
- Confirm whether the decedent held any corporate stock certificates or membership certificates.
- Consult the probate court’s inventory requirements: see NMSA 1978, Section 45-3-605 (Uniform Probate Code).
- Keep estate and corporate assets in separate bank accounts to avoid commingling.
- Label digital assets clearly in your inventory: domain names, cryptocurrency wallets and online accounts.
- Consider hiring a forensic accountant if ownership is unclear or if records appear incomplete.