Personal Representative’s Duties: Duty to Inventory Assets

Once serving as the Personal Representative, it will be necessary to take an inventory of all assets owned by the decedent at the time of his or her death. These items have to be recorded on the state-approved form 350 PC.

Before attempting the paperwork, it’s essential that the Personal Representative follow some general guidelines. South Carolina Code Section 62-3-709 explains that “every personal representative has a right to, and shall take possession or control of, the decedent’s property, except that any real property or tangible personal property may be left with or surrendered to the person presumptively entitled thereto unless or until, in the judgment of the personal representative, possession of the property by him will be necessary for purposes of administration.” In essence, this means it is the responsibility for the Personal Representative to collect the assets UNLESS they are in the possession of the person who will ultimately receive them.

As you might imagine, this duty causes a great deal of friction between Personal Representatives and heirs. Imagine that your husband passes away and that your step-son (his son) is the Personal Representative. You could potentially return home to find ½ of your home furnishings gone because the Personal Representative “took possession” of them to administer the estate. Again, Personal Representatives should walk a fine line between performing their duty and using their powers unwisely. Meanwhile, heirs who are in possession of property belonging to a decedent must cooperate in ensuring that the Personal Representative is aware of the property's location.

Once the Personal Representative has a general grasp on the decedent’s assets, he must list them according to the type of asset and include information about any joint owners.

Before attempting the paperwork, a good Personal Representative can prevent migraine by making a list and collecting the information as follows:

REAL PROPERTY – You will need a copy of the deed to determine who the exact owners are and whether or not the property is held jointly, or jointly with a right of survivorship. You will also need a value for the inventory. This can be the tax assessed value or the fair market value as determined by an appraisal or cost market analysis (available from a real estate agent). Please note that in an effort to reduce estate costs and fees, Personal Representatives will often make the huge mistake of undervaluing the property which can have negative tax consequences on those receiving the property from the estate. Tread carefully in this area, the courts can not and will not give you advice on the value for this reason. If you are unsure how to value, discuss this issue with your attorney or CPA before filing the value with the court.

PERSONAL PROPERTY – The courts don’t expect you to list every piece of “stuff” owned by the decedent; however if an heir begins to contest your management of the estate, a more detailed list may be required. Initially, it’s safe to group items into large categories and give them a resale value (i.e. – what could you get for them if you had to sell them at a garage sale). Common categories include household furnishings, clothing, electronics, collectibles, etc. Sentimental values do not go on an inventory. For example, while your mother’s china may be the prized possession every heir is after, it should only be valued by its actual resale value. eBay or other online resources are very helpful in this regard. Kelly Blue Book or Edmunds are great for placing a value on cars (which also fall in this category).

BANK ACCOUNTS – In South Carolina, there are essentially three ways to title a personal bank account. Sole ownership (decedent was the only person with his/her name on this account), joint ownership (account was held by two or more people), and joint ownership with rights of survivorship (more than one person was on account and ownership shifts automatically to other owners upon death). It is essential that you contact each bank where the decedent held an account and determine the form of ownership. The type of ownership determines not only where it goes on the inventory form, but also who has the right to the funds.

IRA’S – The court will need to know if the decedent had any IRA accounts. If so, you are only required to give detailed information on the account if the estate was named as the beneficiary. Otherwise, most courts just want to know that the account existed and that it named a specific beneficiary to receive the proceeds.

DEBTS – The court will need to know any debts held by the decedent. This does not include consumer debts or debts incurred after death (such as funeral expenses). The debt reported to the court is essentially the debt related to other assets. For example, if a car appears in the personal property, this is where the car loan will appear. If a home appears in the real property, this is where the mortgage would go.

List in hand, it’s time to tackle the official inventory form which must be submitted to the court within ninety (90) days from your appointment as Personal Representative. Having your items sorted as stated above will go a long way in getting you prepared for the inventory form. Another tip – the first page should actually be done last so start with page 2.

And, if for some reason, you just can’t get it done in time, you can use the form 352 to file for an extension. Good luck and make sure to check out other posts under the category Personal Representative’s Duties for other tips.