Did you know that when someone dies owning a home in Massachusetts, the Commonwealth of Massachusetts puts an Estate Tax lien on that home?
What is an Estate Tax Lien?
A lien is a legal claim that says “you need to pay us before you can sell this house.”
The Massachusetts Estate Tax lien arises at your death without any notice to your family and even if no taxes are owed.
The good news is that most people don’t owe any estate taxes. But you still need to remove this lien to sell the home.
Two Ways to Remove the Lien
There are two ways to remove the Massachusetts Estate Tax lien, and which way you proceed depends on how much the deceased person’s estate was worth at his or her death:
Way #1: Simple Affidavit (For Smaller Estates)
Use this method if the total estate is worth less than $2 million.
This is the easier way. You file a simple form called an affidavit with your local Registry of Deeds.
What you need to do:
- Fill out an affidavit form;
- Get it signed by a notary public;
- File it at the Registry of Deeds; and
- Pay the filing fee ($105).
What the affidavit must say:
- The deceased person’s full name and date of death;
- The property address and deed information;
- That the estate is worth less than $2 million and, consequently, no estate tax return is needed (as it would be in Way #2, below);
- That you are swearing to the foregoing under the penalty of perjury; and
- Who you are in relation to the deceased person (spouse, executor, etc.)
Who can sign the affidavit:
- The executor of the estate
- The spouse
- A surviving joint owner
- Anyone who has possession of the property
Way #2: File an Estate Tax Return (For Larger Estates)
You must use this method if the total estate is worth $2 million or more.
This way takes longer, but is required for larger estates.
What you need to do:
- File Form M-706 (Massachusetts Estate Tax Return) with the Department of Revenue;
- Pay any taxes owed;
- Then wait for the state to send you a “Certificate Releasing Massachusetts Estate Tax Lien”; and
- File this Certificate at the Registry of Deeds with payment of the filing fee ($105).
What Happens Next?
Once you file the affidavit or certificate, the lien is removed from the property. Now you can:
- Sell the home
- Get a mortgage
- Transfer ownership
- Do anything else you need to do with the property
Important Things to Remember
- The Massachusetts Estate Tax lien lasts for 10 years if you don’t remove it
- You cannot sell the home until the lien is removed
- Most estates don’t owe any taxes, but you still need to remove the lien.
Need Help?
This process can be confusing. You can contact our office to assist you with either of the aforementioned ways of removing the estate tax lien; that is, the preparation of the affidavit or the preparation and filing of the M-706 (Massachusetts Estate Tax Return), as well as with the recording of the affidavit or Certificate releasing estate tax lien with the Registry of Deeds.
Remember, removing the estate tax lien is required before you can sell any home in Massachusetts where someone has died.
The most important thing is to not wait. Start this process as soon as possible after someone dies so that you will be able to sell the home when you’re ready.
Founded by a nurse attorney and with offices in Acton, Andover, and Sudbury, Massachusetts, Generations Law Group helps families navigate the complex areas of estate planning and elder law to inform and protect loved ones of every generation.
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