Estates

The definition of “estate” is it is the overall worth of an individual (dead or alive) at any point in time. An estate comprises of all of the person’s assets, including entitlements and interests to property of any sort as well as legal rights, minus any liabilities at that period of time. While that is the legal definition of an estate, there are also different meanings depending on the context. An estate can also be “estate in land” (or any other property for that matter). It is also referred to as the sum of only the assets that a person owns.

Brief Historical Background

In the context of law of land, the word estate is from the long ago English feudal system. This system created a very complex hierarchical pattern of interests in land and estates. For over 90 years, as well as at other key times in the history of the United States, there has been inheritance and estate taxes. Actually, taxation of property transfers at the time of death can be traced back to as far as 700 B.C. in Egypt. The U.S. federal government has relied on these taxes as a significant source of income. In the past, the term “death tax” has been used as well and it refers to the taxes incurred by the transfer of property and receipt of property when someone dies. Taxes on a person’s estate at death is usually determined by the size of the estate.

Precedent Setting Cases

The case of United States versus Windsor is a landmark case in estate law as well in the area of same-sex marriages. Windsor and Spyer legally wed in Ontario, Canada while living in the State of New York.

A few years after the marriage, Spyer died and left her whole estate to Windsor. Windsor tried to claim the federal estate tax exemption as a surviving spouse however was barred from the claim. Windsor paid the huge sum in estate taxes then sought a refund which was denied by the Internal Revenue Service. Windsor then brought forward a lawsuit, citing a violation of the principles of equal protection under the Fifth Amendment. The United States Supreme Court ruled that it was unconstitutional to restrict the terms of marriage and spouse to only heterosexual unions. This was indeed a landmark case in favor of Windsor.

In the case of Reed versus Reed in 1971, this precedent setting case involved Equal Protection in the Supreme Court ruling that administrators of an estate cannot be named in such a way that causes discrimination between sexes. In this case, a mother and father was in conflict over who should be the administrator of their deceased son’s estate. In the Idaho Code, males were to be preferred over females when designating administrators for an estate. The Supreme Court overruled this court decision.

Defenses

While there are no defenses in the context of estates, there are ways distribute an estate. One of the main ways an estate is distributed is through probate. During probate, all property, including real and personal, is considered to be the estate of the deceased person. The estate is administered by an executor or administrator, which means that person will protect all the assets of an estate, pay out the expenses and distribute the balance of the estate according to the will.

In the case of bankruptcy, an estate is considered all of the property and assets a person owns that is available for distribution to his or her creditors. There are some assets that are not allowed to be distributed and this typically varies by State. A trustee in bankruptcy is the one who will administer the estate.