Estate Sale
Estate sales typically occur either when a person dies or has a significant change in their living situation which necessitates the sale of all of their belongings. The goal of the sale is to liquidate all of the individual’s possessions within a relatively short window of time.
What is an estate sale?
When a person dies or is forced to leave their home unexpectedly to live with a loved one or in a senior living facility, the matter of what to do with their possessions can present some unique challenges. In many cases, someone’s personal property would be overwhelming to sell or give away individually.
An estate sale offers all of these items, often at a steeply discounted price, to the general public during a set time period. Many people choose to enlist professional estate sale companies to identify and price the items included in the sale and to help process the sales and proceeds from the event.
An estate sale differs from tag sales, yard sales, or garage sales in that it involves selling a wider variety of items in an effort to totally liquidate everyday household items rather than just clear up a bit of space and make a little money. Sometimes, larger and more expensive items are sold through an estate auction before the estate sale process takes place.
A qualified estate sale planner will be able to help you navigate the process smoothly and in accordance with tax laws relating to inheritance and the appreciation of the items sold. Many people planning an estate sale will enlist the assistance of an estate lawyer to help ensure everything is done correctly.
For a more comprehensive understanding of what to expect from an estate sale and how to properly prepare for one, check out LegalZoom’s complete guide to estate sales.
FAQs
Are estate sales taxed?
Generally speaking, yes. The proceeds from an estate sale are subject to federal income tax based on the appreciation of the items’ market value since it was originally purchased. Depending on your location, your state may also have local taxes associated with the settling of your loved one’s estate. It’s a good idea to check for any relevant state taxes before your estate sale takes place.
Who is responsible for conducting an estate sale?
The executor of the estate of the property’s owner is typically tasked with organizing the estate sale and managing the funds raised. In cases where the sale will be complex or will present an excessive burden on the estate’s executor or family members left to organize it, the executor can hire a third-party estate sale company.
What can be included in an estate sale?
Estate sales often include a wide array of items ranging significantly in value. Just about any personal possessions you could imagine might be available at an estate sale, from furniture to clothing, home goods, and appliances.
Who receives the money from an estate sale?
Proceeds from estate sales usually go toward paying off any existing debts the estate might possess, with the remainder of the funds going to the estate’s heirs. Identifying who will be the beneficiary of your assets is just one of the many things that must be addressed while planning your estate.