TeachMeFinance.com - explain abatement
abatement -- the reduction or cancellation of an assessed tax.
Abatement of debts and legacies is a common law doctrine of wills that holds that when the equitable assets of a deceased person are not sufficient to satisfy fully all the creditors, their debts must abate proportionately, and they must accept a dividend.
In the case of legacies when the funds or assets out of which they are payable are not sufficient to pay them in full, the legacies abate in proportion, unless there is a priority given specially to any particular legacy. Annuities are also subject to the same rule as general legacies.
The order of abatement usually goes as follows:
Intestate property (property not disposed of in the will itself) will abate first
The residuary estate will abate next
General devises (gifts of cash) will abate next
Demonstrative devises (gifts of stock, or orders to sell property and give the proceeds to the beneficiary) will abate next
Specific divises (gifts of tangible property) will abate last
About the author
Author: Mark McCracken is a corporate trainer and author living in Higashi Osaka, Japan. He is the author of thousands of online articles as well as the Business English textbook, "25 Business Skills in English".
Copyright © 2005 by Mark McCracken, All Rights Reserved.
TeachMeFinance.com is an informational website, and should not be used as a
substitute for professional financial or legal advice. TeachMeFinance.com and its owner recommend consultation with a professional financial advisor prior to any
investment or financial decision.
Please read our disclaimer.