NEWSLETTERS
Handling Key Non Tax Financial Issues When a Loved One Passes Away
In this article, we dive into some of the non-tax issues you will have to deal with as the executor of the estate.
Getting Extra Death Certificates
For various reasons, a death certificate may be needed to prove that the decedent has indeed passed away. You may need originals (not copies) for some purposes.
Get at least five originals from the applicable source. Get more if the decedent had lots going on—such as real estate owned in several jurisdictions. If in doubt, get more originals than you think will be needed. In fact, get a lot more.
Updating a Married Couple’s Revocable Trust
If the decedent was married, a revocable trust (aka family trust, living trust, or grantor trust) may have been set up to hold the couple’s most important assets and thereby avoid probate for those assets.
Both spouses are usually named as co-trustees. If so, the trust may have to be amended to eliminate the decedent as a co-trustee and add a new co-trustee (usually an adult child) to help the surviving spouse manage the trust’s assets.
If the surviving spouse passes away before the desired changes are made, the trust—with all its uncorrected faults—becomes irrevocable and set in stone. That would not be good!
Selling a High-End Home
If the decedent was widowed at the time of death, the heirs will probably want to sell the home. In most areas, there are distinct home-selling seasons.
The real estate agent will encourage you to get the place ready for sale during that season so it can be sold for top dollar. You may be presented with a ready-for-sale deadline that’s much sooner than you would prefer—more time pressure.
If the decedent was married, the surviving spouse may want to downsize, move closer to relatives, or move to a low-tax state.
Changing the Title to the Home
You may have to change the title to the home before it can be sold.
For example, this can be the case if the home was owned by a revocable trust to avoid probate. If the decedent was single, the trust is now an irrevocable trust, because the person who set it up has died.
Considering Whether the Surviving Spouse Can Live Comfortably without Selling the Marital Abode
If the answer is yes, the survivor may want to stay put. But if the survivor is quite elderly, that may just postpone all the inevitable home sale and relocation issues.
Deciding Whether the Surviving Spouse Can Handle the Finances
Some married couples, and many elderly couples, delegate virtually all financial matters to one spouse. The surviving spouse may not be that person.
Checking the Surviving Spouse’s Life Insurance Policies
The now-deceased spouse may have been the designated policy beneficiary of the surviving spouse’s life insurance policies. This is more likely than not, and it’s not a good thing.
Getting Investment and Retirement Accounts in Order
First, you must find out whether such accounts exist, how big they are, and what investments they hold. Some investments may need to be liquidated to cover the estate’s and/or surviving spouse’s expenses.
Investigating Safe-Deposit Boxes
Get into the safe-deposit box and deal with what you find. There may be more than one box.
- Valuable stamps and rare coins could be in a box.
- Property titles are likely to be in a box.
- There could be U.S. Savings Bonds worth thousands in a box. Who knows?
Shutting Things Down
This step might include shutting down utilities, garbage pickup, yard care, pool service, security monitoring, phone and cable services, and credit cards.
As you can see, there’s much to do and consider when a financially comfortable loved one passes away. If you would like my help or you simply want discuss some of these issues, please call me on my direct line at 559-733-8505.
About the Author
D. Steven Yahnian has been a member of the California Bar and a practicing Attorney since 1980. He has also been a California CPA since 1984. Mr. Yahnian also holds the CFP® designation.
Mr. Yahnian practices in the following areas of law through YAHNIAN LAW CORPORATION:
- Estate Planning & Administration
- Asset Protection Planning
- Tax Planning, Tax Debt Resolution and Tax Litigation
- Business & Corporate Law and Planning
- Real Property Law & Planning
As a CPA/CFP, Mr. Yahnian also has a separate accounting and tax return preparation practice called DSA ACCOUNTING.
Mr. Yahnian is a California State Bar Certified Specialist in the following
• Taxation Law and
• Estate Planning, Trust & Probate Law.
Mr. Yahnian received a B.S. degree in Accounting from USC, a J.D. from Loyola University of Los Angeles School of Law and an LL.M. in Taxation from New York University Law School. He also has a Certificate in Taxation from UCLA (with distinction). Mr. Yahnian also has an MS in Taxation* from UCLA (with Distinction).
*Equivalent
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