Disclaimer: This article is for informational purposes only and does not constitute legal advice. Consult a qualified attorney for guidance on your specific situation.
Detailed Answer
When a creditor submits a settlement demand against an estate in Kentucky, an executor must gather key documents to evaluate the claim and decide whether to negotiate, pay, or contest it. Kentucky law requires executors to give notice to creditors and to inventory estate assets before settling debts. Proper documentation helps you comply with state statutes and protect the estate.
- Death Certificate: Obtain a certified copy of the decedent’s death certificate. This official document verifies the date of death and triggers the claims period.
- Letters Testamentary or Letters of Administration: Provide proof of your appointment as executor. See KRS Chapter 395 (KRS Chapter 395).
- Original Will and Codicils: Review the decedent’s will to confirm bequests and any instructions related to creditor claims.
- Creditor’s Claim Form or Demand Letter: Include the creditor’s submitted proof of debt, such as invoices, statements, or signed contracts.
- Proof of Creditor Notice: Under KRS 395.020, you must notify known creditors within three months of qualification. Document your method of service—certified mail returns, publication notices or personal delivery (KRS 395.020).
- Inventory of Estate Assets: File an inventory listing all real and personal property, bank accounts, investments, and personal effects. See KRS 394.160 for inventory requirements.
- Appraisals and Valuations: Obtain third-party appraisals for real estate, business interests, antiques or collectibles to determine asset values.
- Account Statements and Ledgers: Gather recent statements for bank accounts, brokerage accounts, retirement accounts and credit balances. Compile a ledger of all disbursements, deposits and transfers you’ve made on behalf of the estate.
- Outstanding Bills and Expense Receipts: Collect invoices for funeral costs, medical bills and administrative expenses that may take priority over other claims.
- Tax Returns and Filings: Include copies of the decedent’s final income tax returns and any estate tax filings.
- Distribution Plan or Proposed Settlement: Prepare a written proposal showing how you intend to pay approved claims, distribute assets to beneficiaries and satisfy priority debts under KRS 394.060.
Helpful Hints
- Organize documents chronologically. A clear timeline helps you assess the validity and priority of each claim.
- Maintain a digital and physical copy of all records. Back up electronic files and secure originals.
- Respond to creditor demands within Kentucky’s one-year claims period (KRS 395.100).
- Consult probate court forms. Many Kentucky counties provide standard claim forms and filing instructions online.
- Work with a probate attorney if a creditor files suit. Timely legal guidance can limit personal liability.