Legal Question in Wills and Trusts in Virginia

Can a recipent of trust funds be asked to paid them back if after 11 years the Executor of the trust states that the funds recieved were withdrawn from a different account? We recieved funds back in 99 that we were told were removed from our trust funds. Now we are being told that the money didn't come out of that account and was taken from a seperate account and the executor is asking us to pay back that amount given in total this year. There was never any loan documentation or any discussion of payback until this year (11 years later). IRS has stated we are not liable for the taxes and the executor is threatening to file a 1099 on those funds to us in this year. Met multiple times with IRS and have been reassured that it is not our responsibility. If we are not liable for the taxes how can we be liable to pay back money that we didn't know wasn't withdrawn from our specific trust accounts.

Concerned Sisters


Asked on 11/02/10, 12:52 pm

1 Answer from Attorneys
Michael Hendrickson Law Office Michael E. Hendrickson

So, refuse to repay these funds, and if the executor sues, hire an attorney to

defend you and your concerned sister(s) in the suit. (His threat to file a 1099

should be of little concern to you if you've already been assured--hopefully in writing--by the IRS that you are not liable for taxes on these funds.)

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Answered on 11/07/10, 1:43 pm


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