Which term describes a decrease in asset value caused by actions or inaction of the estate's representative?

Which term describes a decrease in asset value caused by actions or inaction of the estate's representative?

• A. Dividend
• B. Dower
• C. Marshaling the assets
• D. Waste

Answer: (D)

Fiduciaries have a duty to preserve estate assets for the beneficiaries. Waste describes a decrease in value that comes from the estate representative’s actions or inaction—the improper use or neglect of property that diminishes the estate’s value. Examples include selling property below its market value, dissipating funds on personal expenses, or failing to maintain or protect assets. These acts or omissions directly reduce what the estate can pass on to heirs or creditors. Dividends are distributions of profits, not a description of how an estate is managed. Dower refers to a spouse’s rights in a deceased spouse’s property, not to mismanagement of assets. Marshaling the assets is about organizing and prioritizing assets to satisfy debts and claims, not about causing a decrease in value.

Fiduciaries have a duty to preserve estate assets for the beneficiaries. Waste describes a decrease in value that comes from the estate representative’s actions or inaction—the improper use or neglect of property that diminishes the estate’s value.

Examples include selling property below its market value, dissipating funds on personal expenses, or failing to maintain or protect assets. These acts or omissions directly reduce what the estate can pass on to heirs or creditors.

Dividends are distributions of profits, not a description of how an estate is managed. Dower refers to a spouse’s rights in a deceased spouse’s property, not to mismanagement of assets. Marshaling the assets is about organizing and prioritizing assets to satisfy debts and claims, not about causing a decrease in value.