Enter Debt

Create a Debt

To record the existence of a debt that is (or was) part of the estate,

1. Click the Create Debt button on the Debts Tab.
2. In the dialog that appears,
   • Name: Enter a simple name for the debt (e.g., Citibank Visa, Home Mortgage)
   • Type: Select a Type from the list (e.g., Credit Card, Medical)
   • Other: You can enter other information as desired (e.g., value, notes), or enter it later directly into the Debts table
   • Advanced: If you toggle the Advanced switch at the top of the dialog, you will see additional optional fields, which you can also enter later as desired
3. EstateExec will put the new debt at the top of the Debts table (for now) so you can find it easily. The next time you view the Debts Tab, the table will be sorted alphabetically by default, and you can always sort it immediately by clicking the "Name" column header.
4. From now on, you can edit any aspect of the debt by clicking the corresponding table cell in the debt's row. Not all debt columns are displayed by default, and you can choose which columns to show via the View | Table Columns menu (see Debts Table Notes below for important information, paying careful attention to Owed Now Owed Pre-Death in particular).
5. For your convenience, you can attach files to a debt if desired (e.g., notice, loan document, etc.). See Attach Files for instructions.

Debts at Death: If a payment obligation existed at the time of death (regardless of whether you were aware of it, and even if a bill had not yet been sent), you must list the Debt here.

Debts Incurred After Death: If an estate expense was incurred after the death (such as a probate application fee, or ongoing utility bills), you can list it here and then record the corresponding Debt payment, but if you're going to pay it right away, most people simply use the Cashflow Tab to record an estate expense payment. If you do list it here, be sure to leave the Owed at Death amount blank.

Borrow Money for the Estate

Borrowing money for the estate creates a special kind of debt, which results in cash being deposited in the estate account.

1. Click the "Borrow" button on the Debts tab, causing Cash Transaction dialog to appear.
2. Select the Category: a standard "Loan" from anyone, or an "Executor Loan" from the executor (important for reporting purposes).
3. Fill out the rest of the dialog and press "OK".

Creating a loan in this way will automatically create a matching deposit in the estate Cashflow account.

To edit such a "borrow" transaction, either select the debt row (using the checkmark on the far left) and press the "Borrow" button again, or edit the transaction directly via the Cashflow tab.

Changes to a Debt

See the following topics to record a payment to reduce a debt, or to record the forgiving of a debt.

Additionally, it's not uncommon for the value of a debt to change over time, due to ongoing interest or other causes. You can record those changes simply by entering the total value currently owed in the "Value Now" column of the debt.

Types of Debts

Debt types include:

• Bill: Normal bills, such as a utility bill that existed before death.
• Bond: Somewhat rare, in case the decedent issued a personal bond of some kind that will need to be repaid.
• Credit Card: Standard credit card debt.
• Executor Expense: EstateExec automatically includes a Debt for the sum of any as-yet unreimbursed executor expenses. You cannot directly enter an executor expense Debt: EstateExec will calculate this for you from your entries on the Executor Expenses Tab.
• Executor Loan: Some executors end up lending money to the estate to pay early expenses before the executor has access to estate funds, or to handle a situation in which the estate has limited cash liquidity. You should use the Borrow button to create such Debts: see "Borrow Money for the Estate" above.
• Loan: Some executors take out a loan for the estate from a third party when cash is limited and the executor doesn't want to, or can't, provide a loan to the estate personally. You should use the Borrow button to create Loan Debts: see "Borrow Money for the Estate" above.
• Medical: Any outstanding medical bills for the decedent should be listed here. Such medical bills often legally have high repayment priority in cases where the estate is insolvent, and in uncommon cases can increase the limits for following a small estate settlement process.
• Secured: A secured debt is a debt backed by an asset, such as a mortgage.
• Taxes: Federal taxes owed, state taxes owed, you name it.
• Other: Any other type of debt.

Other Debts Table Notes

Here are a few other helpful things to know about the Debts table:

• Account: Some debts have an associated Account ID (such as mortgage loan). You can optionally choose to display an Account column by checking "Account" in the menu in the top right of the table.
• Forgiven: If a creditor forgives all or part of a debt, the debt's "Owed Now" amount will be reduced by the forgiven amount. See Resolving Debts for more information.
• Owed Pre-Death: If the estate owner is still living, you may want to enter an amount for the debt in this field, just to provide a rough idea of what the amount owed may eventually be at the time of death. This field isn't used for any estate calculations, and it is not necessary to fill it in.
• Owed at Death: The amount owed for this debt at the time of death (whether or not you were aware of the obligation).
• Owed Now: When you first enter the "Owed at Death" amount, EstateExec will automatically populate the "Owed Now" field. You can change the "Owed Now" field whenever you like (for example to reflect accumulating interest), but it's not important to keep it frequently updated, and you will be given an explicit chance to update this field when actually resolving the debt.
• Paid: Once you make a payment on a debt, its "Owed Now" will be reduced by the payment amount, and the payment will be added to the "Paid" amount. See Pay Off Debt for more details and instructions for handling multiple payments.
• Probate: Identifies whether the debt is subject to probate. This column is not shown by default, but you can make it visible by checking "Probate" in the menu in the top right of the table. EstateExec automatically assumes all debts are subject to probate, but you can override this setting for a given debt by clicking the debt's probate table cell.

See also Using Tables for an illustration of many things you can do with EstateExec tables in general.