If I’m the executor on my mother’s estate and a beneficiary of it and needed to put money into the estate in order to protect an asset, am I entitled reimbursement in addition to my inheritance?

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If I’m the executor on my mother’s estate and a beneficiary of it and needed to put money into the estate in order to protect an asset, am I entitled reimbursement in addition to my inheritance?

She has been deceased for about 1 1/2 years. The house had an outstanding mortgage of $21,000.and the bank was threatening foreclosure. I borrowed off my 401K to pay the house in full but now the attorney is telling me that I can not receive this money back. I kept my siblings abreast of all of the legal problems with the house, now I am not going to be reimbursed and will just split the money by 4. Is this legal?

Asked on December 31, 2014 under Estate Planning, New York

Answers:

M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney

Answered 6 years ago | Contributor

I am so sorry for your loss. No, it does not sound correct.  What you made was a loan to the estate and the estate needs to pay that debt off prior to distribution of the funds to the beneficiaries.  Was there a loan document or other communication that will document the loan?  The withdrawal of the 401K funds and then the subsequent payment of the mortgage may be enough so long as it does not violate the statute of frauds.  I would find a different lawyer.  Good luck.


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