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Ask Marilyn: How Does One Heir Buy Out Other Heirs?
E.M. in Atlanta, Georgia, writes:
Marilyn: One of my siblings died and left real estate to his brothers and sisters. Each is to receive an equal portion of land. One brother is talking about buying out the others. But he wants to divide the money he pays for the property with all of us, including himself as an heir. Is this right and fair to the rest of us?
Yes, this is the correct way to distribute the funds. Look at it this way: Say the property is worth $500,000, and there are five siblings. You would each get $100,000 worth of land. But instead, your brother buys the property. He now has the property, and the estate has his $500,000. You divide it five ways, and you each receive $100,000 in cash instead of $100,000 in land.