Detailed Answer
This answer explains what typically happens to leftover proceeds from the sale of a deceased person’s property when the person died without a valid will (intestate) under Virginia law. This is an educational overview, not legal advice.
How sale proceeds fit into the estate
When someone dies, anything they owned in their individual name — including cash, bank accounts, and proceeds from a sale completed before or after death — generally becomes part of their estate (their probate estate) unless the asset passed automatically to someone else by law or contract (for example, joint tenancy, a transfer-on-death designation, or life insurance that names a beneficiary).
If the property was sold before death and the seller received the cash in their name, that cash is an asset of the decedent and goes into the estate. If the sale happens after death (for example, the decedent owned real estate and the court-appointed personal representative sold it), the sale proceeds are estate assets and are handled in probate.
Who gets the leftover proceeds when there is no will
When a person dies intestate in Virginia, Virginia’s intestacy rules determine who inherits the remaining estate after debts, funeral expenses, taxes, and administration costs are paid. The general priority order under Virginia law goes to the surviving spouse, then children, then parents, then more distant relatives as provided by the Virginia intestate succession rules. For the statutory framework, see Virginia Code Title 64.2 (Wills, Trusts and Fiduciaries): https://law.lis.virginia.gov/vacode/title64.2/.
Key points about distribution:
- The estate must pay valid debts and expenses before distributions. If the estate lacks liquidity, the personal representative may need to sell assets (or use sale proceeds) to pay creditors and expenses.
- If the decedent left a surviving spouse, that spouse often has the first claim to all or a large share of the estate. If there are surviving children or descendants, the estate will be split according to statutory rules.
- If there is no surviving spouse or descendants, the estate may pass to parents, siblings, or more distant relatives under the intestacy rules.
Probate administration in Virginia
To distribute sale proceeds that belong to the estate, someone (often a close family member) must open probate in the circuit court and ask the court to appoint a personal representative (administrator). The personal representative’s duties include:
- Collecting estate assets (including sale proceeds).
- Providing notice to creditors and paying valid claims and taxes.
- Paying funeral expenses and administrative costs.
- Distributing the remaining funds to heirs according to Virginia’s intestacy laws.
Practical information and forms for probate are handled in the local circuit court where the decedent lived. See the Virginia Code Title 64.2 for the statutes governing probate and administration: https://law.lis.virginia.gov/vacode/title64.2/.
Nonprobate transfers and exceptions
Money that passes outside probate does not become estate property subject to intestacy. Common nonprobate transfers include joint accounts with right of survivorship, payable-on-death (POD) accounts, transfer-on-death deeds (if properly executed), and life insurance or retirement accounts with named beneficiaries. Those funds go directly to the named survivor or beneficiary and do not enter into the probate distribution of sale proceeds.
Example scenarios (hypothetical summaries)
Example A — Sale before death: Ms. A sold a rental and received $80,000 in her bank account before she died. The $80,000 is an estate asset. The administrator collects that cash, pays Ms. A’s debts, and then distributes the remainder to heirs under Virginia intestacy rules.
Example B — Sale after death: Mr. B owned a house as his sole asset. After Mr. B died intestate, the court appointed a personal representative, who sold the house. The sale proceeds first paid the funeral costs and creditor claims; any remainder was distributed to heirs per Virginia intestacy law.
Timing and creditor priorities
Creditors and administrative costs have priority over heirs. The personal representative must follow the court’s procedures and any statutory notice periods before distributing funds. If a creditor’s claim is allowed, it reduces the amount available to heirs.
What to do if you think you are owed money
- Check whether the asset passed outside probate (joint account, POD, beneficiary designation).
- Contact the local circuit court clerk to find out whether probate has been opened for the decedent’s estate.
- If probate is open, contact the personal representative to ask about the estate inventory and timeline for creditor notices and distributions.
- If no probate has been opened and you think you are an heir or have a claim, consider filing a petition with the circuit court to open administration or consult an attorney about your options.
Where to look in Virginia law
For statutory rules on probate, intestacy, and administration, review the Virginia Code Title 64.2 (Wills, Trusts and Fiduciaries): https://law.lis.virginia.gov/vacode/title64.2/.
Important disclaimer: This information explains general Virginia law and common procedures. It does not constitute legal advice. For advice about a specific situation — including exact shares under Virginia intestacy law, small-estate procedures, or complex assets — consult a Virginia probate attorney or the circuit court clerk in the county where the decedent lived.
Helpful Hints
- Identify nonprobate assets first (joint accounts, POD, beneficiaries). Those funds usually bypass probate.
- Locate the decedent’s financial records and title documents to determine whether sale proceeds were received in the decedent’s name.
- Contact the local circuit court clerk’s office to learn whether someone has opened probate and who the personal representative is.
- Keep records of communications and receipts if you are the personal representative — creditors and court will require documentation.
- Be aware that creditors have priority; heirs receive distributions only after valid debts and administration costs are paid.
- If the estate appears small, ask the court clerk about simplified or small-estate procedures that may speed distribution without full probate.
- When in doubt, consult a Virginia probate attorney early — they can explain statutory shares, required notices, and timing for distributions.