PRACTICAL INSTRUCTIONS FOR PREPARING THE INVENTORY

Font Size & Margins

THE USE OF 10-12 POINT FONT SIZE IS REQUIRED.

Since your filings will be recorded in the Henrico Circuit Court fiduciary records, the font size used on inventory and accounts should not be less than 10-12 point.

MARGINS ON ALL FOUR SIDES OF EACH PAGE OF THE ACCOUNT MUST BE 1″ OR MORE.

Digital copying of the account for the electronic public computer records requires these margins. Failure to comply may result in the return of your account to be re-stated to meet these standards.

No Excel spreadsheets should be submitted unless they comply with these requirements.

Your inventory and/or account may be returned if it is not clearly legible and a minimum of 10-12 point font size.

INVENTORY FORMS

Form CC-1670 is the required form for the filing of an Inventory of the assets of a decedent’s probate estate.  At the time of qualification you were given Form CC-1670 and Form CC-1670 (INST), an instruction summary for completing the inventory.  These instructions are specific and will give you all of the information needed to properly complete the inventory.  It is critical that the inventory be correctly stated in terms of the assets of the probate estate and those assets are placed in the proper location on the form.

Certain assets of a decedent pass outside of the probate estate and are not included on the inventory.  These assets would include real estate which has a survivorship designation in the deed, life insurance with a designated beneficiary, annuities or retirement accounts with a designated payee.  These assets, as you will determine from the instructions, are not listed anywhere on the inventory because you have no control over them as personal representative–except potentially as to accounts and CDs with banks and/or credit unions if the estate is unable to pay all creditors.

For joint or pay on death accounts or certificates of deposit with banks and credit unions, they must nonetheless be listed in Part 2 of the inventory even though they pass by survivorship and are not under your control as personal representative.  Joint or survivorship bank or credit union accounts/CDs must be reported in Part 2, but are not included in the total value of assets under your control totaled on the first page of the inventory form. 

For example, if John Doe has a joint bank or credit union account with his daughter Jane Doe as co-owner, or on which Jane was designated as the survivorship beneficiary, or pay on death (“p.o.d”) beneficiary, that account passes outside of the probate estate by survivorship under Virginia banking regulations; is not included in the total probate estate; is not subject to administration by the executor; but must be shown in Part 2 of the Inventory.  The proper designation in part 2 for example would be:

        SunTrust Bank checking account (2140)..$10,000.00, survivorship to Jane Doe 

Note: If the account was joint only as a convenience in transacting business for the decedent prior to death, and was not intended as a survivorship account, it should be a part of the probate estate and listed in part 1 of the inventory. Such an account may have been a power of attorney account or an account in joint names only to facilitate the paying of the decedent’s bills prior to death.

COMPLETION OF THE FIVE SECTIONS OF THE INVENTORY

PART 1: PERSONAL PROPERTY

Part 1:  This section includes tangible and intangible personal property owned by the decedent over which you as the fiduciary have control. If the asset passes by a beneficiary designation made by the decedent before death, it passes according to that designation and not under the will. If a life insurance policy was owned by the decedent but had a designated beneficiary named in the policy, it is not reported in Part 1. or anywhere else on the inventory, because it is not under your supervision and control. It passes by the terms of the life insurance contract. If the policy states that the “estate” is the beneficiary, or the named beneficiary does not survive and the policy does not name an alternate beneficiary, it will be listed as a Part 1 asset. You must review the contract to see what the default provisions are for payment of the policy at death.

The date of death value is used when reporting all assets on the inventory.

If the decedent owned stocks and bonds, call the stockbroker and get a listing of each investment in the portfolio with the date of death values for each investment.  Determine if the brokerage account had a named beneficiary (T.O.D.-transfer on death). If so, it is not under your supervision and control and passes by the T.O.D. designation to the named beneficiary and will not be listed anywhere on the inventory.

Do not list the entire stock brokerage account with one value.  The individual stocks, bonds, mutual funds, cash accounts or other assets of a brokerage account must be listed if it has no named T.O.D. beneficiary.  For example, an account at Morgan Stanley worth $100,000.00 should not be listed in that manner, but should be listed with the breakdown of each asset in the portfolio.  If the account has 1000 shares of Exxon stock valued at $50.00 per share on the date of death, and 2000 shares of Anthem at $25.00 per share on date of death, these individual companies must be listed with the number of shares, per share value and total value for each company’s stock on the date of death or close of business on the last business day before death. You may list the entire value in Part 1 with a reference to an attached exhibit itemizing each individual asset held in the account by separate value, number of shares and per share value on the date of death.

Bank/Credit Union accounts just in the decedent’s name without any survivorship designation should be listed by type of account (checking, saving, money market, CD, IRA), with the date of death balance for each separate type of account.  Only the last four digits of the account number should be shown for any account listed on the inventory or any other filing to protect individual and estate privacy. Joint bank accounts are not listed in Part 1 unless it is a power of attorney account. Joint accounts (accounts in multiple names or having a pay on death beneficiary on the account) go to the survivor by contractual agreement with the bank, but they are listed in Part 2. if in a bank or credit union.

The value of automobiles may be obtained online at NADA, or KELLEY BLUE BOOK. Use the fair market value without reduction for any lien on the vehicles, not wholesale or trade in value.

OWNERSHIP OF JOINTLY TITLED VEHICLES

Ownership of jointly titled vehicles should be reported as follows in accordance with current DMV regulations:

a. The surviving titleholder is considered a joint owner with the right of survivorship if;

     (i) The title reads John Doe “or” Mary Doe; or

     (ii) The titleholders’ names are followed by the words “or survivor”.

     Under the above circumstances the decedent’s estate would have no interest in the vehicle and the vehicle would not be reported in Part 1 or anywhere else on the inventory.

b. If only the decedent’s name appears on the title, or the prior joint titleholder predeceased, the total interest in the vehicle is reported in Part 1;

c. The surviving titleholder does not have the right of survivorship if:

      (i) The word “and” appears between the titleholders’ names; or

      (ii) The words “or survivor” do not appear after the titleholders’ names.

      Under the above circumstances the decedent had a 1/2 interest (if two titleholders) and the 1/2 interest is reported in Part 1 at 1/2 of the fair market value, without reduction for any lien.

TANGIBLE PERSONAL PROPERTY

Furniture and Furnishings are often omitted, but should be reported. The items may be reported collectively at a value that you could expect to receive at auction or back yard sale if not collectables or antiques. Any individual item worth $500 or more should be listed individually. Any item specifically bequeathed in the will should be listed separately. These items are not valued at replacement cost, but the price that a sale would bring to the estate.

Clothing should be reported as a collective item at a nominal value, unless there are valuables such as fur coats which should be listed separately. The omission of clothing raises frequent objections by heirs or beneficiaries. Before donating the clothing to charity ask the heirs or beneficiaries to email you their agreement to donate the clothing. Sometimes family members wish to have the usuable clothing of the decedent. Offer clothing to beneficiaries first before donating to charity.

Collections (stamps, coins, guns, toys, cards, dolls and others) may be valued by calling dealers or clubs involved in the same type of collection or searching online for dealers, experts or clubs. Do not assume the collection has no value. Do some research to determine interest in the collection.

Antiques and fine jewelry must be listed by individual item and may need to be appraised depending on the disposition of the asset provided for in the will, or the value of the estate if estate taxation may be involved.

Costume jewelry can be valued at one value without the need to itemize.

U. S. Savings Bonds must be listed individually by serial number and denomination. The date of death value of U.S. Savings Bonds may be obtained online at www.treasurydirect.gov/BC/SBCPrice.

Check with the Virginia Division of Unclaimed Property to see if the decedent had any right to unclaimed property at the time of death at www.VaMoneySearch.org. If you prefer call (800) 468-1088.

BE CAREFUL in listing all assets of the decedent. Items omitted become “priceless” to some heirs and beneficiaries, and to omit them or dispose of them by donation could create problems in the accountings to be filed.

                                                        IS APPRAISAL NECESSARY?

There is no requirement for appraisal of the entire estate and to do so is generally a waste of estate money, unless appraisal is directed by the will, or appraisal is necessary to properly allocate personal property by equal value among beneficiaries/heirs, or the estate is taxable for Federal estate taxes.

****All inventory assets are reported at fair market value without reduction for anything owed on the asset.

PART 2: MULTIPLE PARTY BANK AND CREDIT UNION ACCOUNTS

Part 2: This section lists only multiple party bank and credit union accounts and certificates of deposit. These accounts are NOT part of the probate assets under your control as personal representative, but are reported for informational purposes for creditors in the event the probate estate is insufficient to pay all creditors.

If a multiple-party account is omitted from Part 2 of the Inventory and such account is later discovered through the audit process, the Commissioner will require the fiduciary to file an amended Inventory with the Commissioner.

A joint or multiple party account is any one of the following:

             (i) an account which the decedent owned and is titled with another (except a power of attorney or as trustee); or

             (i) an account on which the decedent had made a “pay on death” (POD) designation; or

             (iii) an account which contains a “survivorship” designation on the account card establishing the account.

Only joint accounts/CDs with banks and credit unions are listed in Part 2. (no brokerage cash accounts in multiple names or TOD, no life insurance with named beneficiary ; no brokerage joint or TOD accounts).

The bank name, last four numbers of the account and joint or survivor payee must be listed with the date of death value of the account. Please refer to Form CC-1670(INST) for further clarification on bank and credit union accounts.

If the account was joint only for convenience with an attorney in fact (POA) being listed or some other person listed only for signing purposes, the account is a probate asset and must be listed in Part 1.

 
If a person acting as power of attorney for the decedent prior to death establishes or changes an account to name himself as beneficiary prior to death, and the account had not been so established by the decedent personally, it must be listed in Part 1, because such a designation by an attorney in fact naming himself as beneficiary represents self dealing and would be considered improper, a breach of fiduciary duty (and possibly criminal).

Virginia statutory law (Section 6.2-608, Code of Virginia (1950), as amended, controls the disposition of joint, pay on death (POD), transfer on death (TOD) and specifically designated survivorship accounts upon the decedent’s death, and you may have to consult those statutes or consult with an estate attorney if you have a question as to whether the bank or credit union account is an asset of the estate or passes outside of probate.

You should obtain copies of the account cards for each bank account to determine how the account was established. You should save these account cards for future reference in case your determination is questioned by a beneficiary and for presentation to the Commissioner with your inventory. If the bank or credit union no longer has the account card, request a letter from the institution describing how the account was established as to ownership at death. See Sections 6.2-604; 6.2-605; 6.2-606; 6.2-607 and particularly 6.2-608, Code of Virginia (1050), as amended.

NOTE: We require proof that the accounts reported in part 2 were, in fact, joint or survivorship accounts. This proof must be submitted with your inventory. Copies of the bank statements in the month of death may show how the accounts were titled. If not, a copy of the account card must be obtained from the bank. If none exists, a letter from the bank stating how the bank’s records reflect ownership at death will be sufficient.

The same information is required even if all the beneficiaries/heirs are listed as joint account holders, so that we may determine that the assets have been correctly reported in Part 2., and should not be Part 1. probate assets.

NOTE: If a brokerage account was owned by the decedent, who during his lifetime executed with the broker a transfer on death designation (TOD), the account is not listed in part 1 because it passes by survivorship designation, and will not appear in Part 2 of the inventory because it is not an account held by a bank or credit union. Do not assume a brokerage account was T.O.D. Ask for the documentation for your file.

PARTS 3 AND 4: REAL PROPERTY IN VIRGINIA

Parts 3 and 4: Real estate in Virginia is listed in Part 3 or 4 on the Inventory:

1. If the decedent had a will and if you have power to sell real estate under the will, and the decedent’s real estate does not pass by survivorship designated in the deed, that real estate is reported in Part 3. It does not matter what the will does with the real estate as we are concerned about ownership just prior to death. The ownership interest may be whole or fractional with others. You must read the deed or determine from real estate records what interest the decedent’s owned in the real estate.
   
   Read the will to determine if you are directed to sell, are specifically authorized to sell real estate, or if the fiduciary powers of Sections 64.1-57 or 64.2-105, Code of Virginia, are incorporated by reference, giving you the power to sell real estate among other powers. Just because there is a will does not mean you have a right to sell real estate. The power must be specifically granted.
2. The value stated may be the fair market value based on a certified real estate appraisal (which must be supplied with the inventory), or the year of death tax assessed value by the county/city wherein the property is located. The Henrico County tax assessed value may be obtained by phone at 804-755-7380, or on the internet by street address at www.co.henrico.va.us. Once on the County website click on “real estate property information” under online services on the left of the page, then check the “disclaimer” box, click on “submit” and you can enter the street address for the tax assessed value.
3. If the decedent had real estate and you qualified as executor, but the will did not give you the power to sell real estate, or if you qualified as the administrator of an intestate estate (no will), you have no power of sale over real estate, and the decedent’s interest in Virginia real estate should be listed in Part 4 of the inventory.
                                                                           PART 5: REAL ESTATE OUTSIDE OF VIRGINIA
4. Non-Virginia real estate anywhere in the world, owned by the decedent entirely or partially, should be listed in Part 5 of the Inventory.
   
5. NOTE:
   1. Burial rights owned by the decedent are generally treated as personal property, not real estate, and are reported in Part 1.
   2. Time shares may be treated as real estate if there is a recorded deed; or personal property if a contract right gives the decedent no ownership in the property but the “right to use” the real estate for designated periods.
6. The value to be listed for real estate is the tax assessed value or appraised value without reduction for deed of trust notes (mortgages) on the property.

         TRANSFER ON DEATH (TOD) DEEDS

You may have to go through an “ancillary administration” of the estate in the state where the real estate is located in order to sell or transfer the real estate. You should make contact with an estate attorney in the city or county where the property is located to advise and assist you in administering the foreign real estate.

When is the Inventory Filed?

The inventory shall be filed within four (4) months from the date of your qualification.  Failure to file could result in a delinquent letter, a summons by the Commissioner or an Order to appear before the Court. If you have not completed your search for the decedent’s assets when the inventory is due, file the first inventory timely, followed by a restated inventory when you have discovered all assets.

Where is the Inventory Filed?

The inventory is delivered or mailed, in duplicate, to the Henrico County Commissioner of Accounts, 4114-A  East Parham Road, Henrico, VA. 23228. An estate check for the filing fees and Clerk’s fee should accompany the inventory. Those fees are published several times on this website including at the bottom of this page.

What is filed with the inventory?

File the Inventory in duplicate, signed by all fiduciaries, with a COPY OF THE BANK STATEMENTS, IN THE MONTH OF DEATH, FOR ALL PART 2 ACCOUNTS REPORTED. Include a check for the appropriate fees as determined from the schedule of the inventory filing fees.  With the Commissioner’s fee you shall include the Clerk of the Circuit Court’s filing fees based on the number of pages submitted, usually a $18.00 clerk’s fee. All fees shall be written as one (1) check payable to the Commissioner of Accounts.

Clerk of Court fees:

1 – 10 pages…………………………….$18.00

11 – 30 pages…………………………..$32.00

31 or more pages……………………..$52.00

The Commissioner’s fee schedule is as follows:

$ 0-50,000………………………………$135.00

$50,001-200,000……………………..$200.00

$200,001-500,000……………………$275.00

Above $500,000.00………………….$350.00

Supplemental or amended inventory……….$ 110.00 plus Clerk’s fee of $18.00

NOTE: ALL COSTS PAYABLE TO THE COMMISSIONER AND THE CLERK’S FILING FEES, SHOULD BE PAYABLE TO “HENRICO COMMISSIONER OF ACCOUNTS”, IN ONE CHECK FOR ALL FEES AND COSTS.

Forms to be Used for Testate and Intestate Estate Inventory:

1. Inventory of Decedent’s Estate (Form CC-1670 | Instructions)