Who's estate is it counted in?

My parents died recently and still have a debt to be paid to them. The legal contract that states the handling of this amount says it goes their estate when they die. Nothing individual. Does it mean the amount to be paid needs to be counted in the second parent that died or split between the two?

If the original debt was to "John or Mary" or to "....or the survivor of them" then it PROBABLY all goes in estate #2.

If the debt was to "John AND Mary", or otherwise written to bifurcate the debt between your parents, then it will PROBABLY be split between the two.

Specific state laws of probate vary greatly. It is possible that there is a state that declares all debts to both to be the sole property of the survivor by operation of law, regardless of how the debt was taken, unless certain hurdles are jumped to avoid that effect.

You should ask this of a probate attorney in your state.

It depends on which state they lived in and what the paper says.

Sounds like a mortgage or something. Anyway, generally if it was owned as husband and wife, and one died, it goes to the other. When the other dies, it goes to that person's heirs.

Since your question lacks specifics like what kind of contract or paper you have, how it was titled to your parents, what state you're in, whether they left wills or mutual wills, no one can answer.

Hire a lawyer in your jurisdiction and you will get a more definitive answer.