ARTICLE · 16 MARCH 2022

Paying debts from a deceased estate

Stacks Law Firm

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Debts and taxes must be either repaid or refinanced before the property is transferred to the beneficiary.

AustraliaFamily and Matrimonial

Joshua Crowther

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Death and taxes - the only certain things in life. But when it comes to paying debts from a deceased estate, which ones must be paid first?

Many of us would rather pay any debts we owe to friends and relatives before the taxman and banks get their hands on it. However, while it would be nice to think you can control the payment of your debts after death, sadly it isn't so.

Tax is the first debt to be paid out of your estate when you die

The first debt that must be repaid out of the estate is any tax that you owe, in full. Your estate can't pay only half your taxes in order to leave something for your beneficiaries. If paying tax debt consumes your entire estate, then that's it.

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