What Is Estate? Definition | Epic Life Glossary

Why it matters

An estate may owe bills, taxes, and fees before heirs receive anything. Few estates owe federal estate tax, because the exemption is high, but state rules differ. Life insurance can add cash for expenses and be paid to a named beneficiary outside the estate. Families should keep records and know where documents are. Complex situations call for an estate attorney. This is general information, not legal or tax advice.

Source: law.cornell.edu

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Related terms

Probate: Probate is the court-supervised process of proving a will, paying debts, and passing a dead person's assets to heirs. Rules and time frames vary by state.
Beneficiary: A beneficiary is the person or organization the policy owner names to receive the death benefit when the insured person dies. A policy can name one or several beneficiaries and can split the payout by percentage.
Legacy Planning: Legacy planning is the process of deciding how your assets, wishes, and values pass to people and causes you care about. It often includes a will, beneficiaries, and insurance.
Final Expenses: Final expenses are the costs that come up near the end of life, including funeral or cremation, burial, medical bills, and small debts. Final expense insurance is built to help pay them.
Death Benefit: A death benefit is the money a life insurance carrier pays to the beneficiary when the insured dies. It is usually paid as a lump sum and is generally income tax free to the beneficiary.

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