What is considered an asset?
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What is considered an asset?
My sister died with no Will and gave no power of attorney for financial matters to anyone. Are her furniture and car (if paid for) considered assets? Her possessions have to be out of her apartment by the end of the month. Some of the furniture was a gift and I don’t think she owes any money in regard to that but I don’t know.
Asked on February 2, 2016 under Estate Planning, Arizona
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 8 years ago | Contributor
Legally, an asset is anything owned by the deceased. If your sister owned (e.g. not leased it or had not borrowed it from a friend/damily) is an asset--and that's so even if she owed money on it, though (as discussed below) if an item was financed and not paid off, it will go to the person or business who provided the fianancing.
From an accounting perspective, anything with a quantifiable--or determinable--positive monetary, or money, value. So furniture or other personal property, including a car, is an asset so long as it is worth more than is owed on it. Something with a negative value (like a $10,000 blue book value car for which $12,000 is still owed) is a liability from an accountng viewpoint.
Note though that if an item or possession was financed and money is still owed, then if the loan/financing is not paid off, the lender or seller (whomever financed it) has the right to repossess, the same way that if a home mortgage is not paid, the bank can foreclose on the home. "Secured" loans--loans which have the property they were used to buy guarantying or securing the debt--must be paid to retain the property.
And if something (like a car) was leased, then it is not an asset of your sister, since she was not the owner; it belongs to the person or business from whom it was leased.
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