What Is a Probate Sale?
A probate sale occurs when a deceased person's property must be sold as part of settling their estate. In New York, the executor (named in the will) or administrator (appointed by the court) has the authority to sell — but only after receiving Letters Testamentary or Letters of Administration.
Steps to Sell a Probate Property
The probate selling process has specific legal requirements:
- File the will with the Surrogate's Court in the relevant county.
- Receive Letters Testamentary (if there's a will) or Letters of Administration.
- Get the property appraised for estate tax purposes.
- List the property — as-is or after improvements.
- Report the sale proceeds to the court during estate settlement.
Selling As-Is vs. Making Improvements
Many probate properties have deferred maintenance. Executors must weigh the cost of repairs against the potential increase in sale price. In some cases, selling as-is to an investor or buyer who accepts condition issues is the fastest path.
Tax Implications for Heirs
Inherited property receives a 'stepped-up basis' — meaning your cost basis is the fair market value at the date of death, not what the deceased originally paid. This can significantly reduce or eliminate capital gains tax on the sale.
