Estate Administration Basics: What to Do After a Loved One Dies

Estate Administration Basics: What To Do After a Loved One Dies

Losing a loved one is one of the most emotional times a person can go through. Dealing with their material possessions (i.e. the estate) shouldn’t be an additional burden, but it frequently is. Most people have no idea where to begin the process of sorting through accounts and belongings.

When I meet with clients regarding estate issues, I have a checklist that I go through with them. The following list isn’t everything I go over, but it will give you some important steps to consider:

1. First things first. Some things need to be taken care of immediately, with the most obvious example being pets. Pets should not be left alone in an empty house. Someone needs to make sure they are taken to a new home, and that they don’t go hungry in the meantime. You should also notify Social Security and any other income source that stops on death – any payment received after death will need to be returned.
2. Find the will and trust. The next priority is finding the will and/or trust if the person had them. These documents tell everyone who is in charge, so little can be done without them. They will also tell everyone what should happen to the estate, which will make life easier for whoever is in charge.
3. Update the title on the assets. Dead people can’t own anything, so the person in charge will have to change the name on the bank accounts, real property, and other assets the person owned. This is pretty straightforward if there is a will and trust; without these, the title can only be changed with an Affidavit of Small Estate (if the estate is worth less than $180,000) or with Letters of Administration from the Probate Court (if the estate is worth more than $180,000).
4. Pay off bills, debts, and the IRS. Nothing can be distributed until all debts are paid. This includes the government, which still wants whatever taxes are owed to be paid on time. However, the final income tax return can be submitted up to nine months after the date of death.
5. Distribute assets. This process is fairly simple with a will and trust – you simply follow the directions given in the documents. Without these, assets will go to the deceased person’s legal heirs, as determined by the Probate Code. In addition, if the estate is going through probate, you’ll need permission from the Probate Court before making any distributions.

My checklist is a bit longer and more detailed, but this gives you a 50,000-foot overview of the process of what to do after a loved one dies. If you would like a more thorough overview or have questions about an estate, please feel free to email me at kaway@kawaylaw.com.