Inheritance questions

[wazup]

Having an argument with a friend over this, so thought I would ask on here for input.

I actually have no clue how this stuff works.

Let's say you have a grandma and grandpa. They are married in community of property. They don't have a joint bank account, but each of them has a bank account and investments in his/her own name.

Grandma has a will that gives a portion to each kid and each grandkid, and the rest goes to the spouse. Grandpa's will is the same.

Grandma dies. What happens now?

A. The will gets executed, each kid and grandkid gets his/her portion as stipulated and the rest goes to grandpa.

or

B. Everything goes to grandpa, and when he dies, his will is executed as stipulated (if this is the case, what was the point of grandma having a will? In case she was the last one to die?)

or

C. Something else?

Also, how would the scenario differ if they were married out of community?

Last two questions:
Is it true that you are not taxed on money you inherit?
Can you inherit debt? Can somebody leave debt to a heir in his will?

 

[The_Ogre]

B will be executed. Whats hers is now his. COP applies.

Vice versa if he died first.

 

[KalMaverick]

B will be executed. Whats hers is now his. COP applies.

Vice versa if he died first.

Why do you say B will be executed. There is a will in place.

Grandma dies. What happens now?

A should apply (more or less). Half of the estate will go to grandpa first and what's left will get distributed in terms of the will, ie children/grandchildren first and what's left to Grandpa.

Is it true that you are not taxed on money you inherit?

You aren't taxed on money you inherit because the estate is taxed.

Can you inherit debt? Can somebody leave debt to a heir in his will?

No you don't inherit debt, not directly anyway, the estate 'gets' the debt, therefore it's possible you get less inheritance because of a debt.

Also, how would the scenario differ if they were married out of community?

Grandma's estate will be distributed according to the will without first dividing it in half, ie first the children/grandchildren get their portion and what's left goes to Grandpa.

 

[The_Ogre]

Apologies, I think Kal's correct. I always thought COP comes first - google says I'm wrong :l

 

[Drifter]

A takes place. Her will is executed and the rest goes to pops.

 

[rorz0r]

You can't inherit debt but for example the will leaves a house to you but there's a bond then you must either sell the house, settle the bond and inherit the balance or take the whole house but have to pay in to the estate to settle the bond. If the bond is more than market value then Estate is insolvent and you get nothing. You may get some sentimental low value items free, if there's other high value sentimental items you'll basically have to buy them.