Estate (law)

An estate is the net worth of a person at any point in time alive or dead. It is the sum of a person's assets – legal rights, interests and entitlements to property of any kind – less all liabilities at that time. The issue is of special legal significance on a question of bankruptcy and death of the person. (See inheritance.)

Depending on the particular context, the term is also used in reference to an estate in land or of a particular kind of property (such as real estate or personal estate). The term is also used to refer to the sum of a person's assets only.

Under US bankruptcy law, a person's estate consists of all assets or property of any kind available for distribution to creditors. However, some assets are recognized as exempt to allow a person significant resources to restart his or her financial life. In the United States, asset exemptions depend on various factors. For example, in the state of New Mexico, a choice between following federal exemptions and state exemptions is given. The estate (or assets) of a bankrupt person is administered by a trustee in bankruptcy. The legal position in all common law countries is similar in this respect.

In land law, the term "estate" is a remnant of the English feudal system, which created a complex hierarchy of estates and interests in land. The allodial or fee simple interest is the most complete ownership that one can have of property in the common law system. An estate can be an estate for years, an estate at will, a life estate (extinguishing at the death of the holder), an estate pur auter vie (a life interest for the life of another person) or a fee tail estate (to the heirs of one's body) or some more limited kind of heir (e.g. to heirs male of one's body).

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