Does the child who inherits a loan owe the balance that was due at the time of settlement? Posted on May 24, 2011
Mother died leaving entire estate equally to all children. The estate included an outstanding loan to one of the children. The estate has been 'settled' according to MD law (not sure what that means, but apparently MD considers the estate processing complete). But, years later, the loan still has not actually been paid and the money distributed to the other children. The question is, at this point, does the child who had the loan owe the balance that was due at the time of settlement? Or do the original terms of the loan (9%!) continue so interest and late charges continued to accumulate? And if interest did continue to accumulate, does that mean that (when/if paid) I have to go back and amend years of tax returns to show interest earned?
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