Walk me through settling an estate

[disneysteve]

I have a terminally ill relative for whom I am the executor and sole beneficiary. I have a full breakdown of all of his financial accounts, where they're held, how to access them, who to contact, how much is in each one, etc.


What I don't know is what do I actually do after he dies? Can I just walk into his bank, for example, with a copy of the death certificate and close out his account? What about his Vanguard retirement account?


He also owns two individual stocks for which he holds the certificates - they aren't with a brokerage. What do I need to do to get them into my name and be able to sell them?


He does have another retirement account held with a money manager and I've already been in touch with that person. Once my relative dies, I'll call that guy and I'm sure he'll walk me through what I need there.


I am named as beneficiary on all accounts that can have a beneficiary. Everything else is left to me in the will.


And what about the will? Do I call the lawyer who prepared it?


Any guidance would be greatly appreciated. Fortunately, I've never had to deal with any of this before.

 

[audreyh1]

If you are named as beneficiary, transfer on death, then yes having the death certificate should be sufficient.

Otherwise you need to have some documentation that shows you are the estate representative per the will. Yes, talk to the lawyer who prepared the will. This will allow you to complete the rest of the steps.

You will also have to file taxes for the year of death for the deceased person. Who does the taxes now?

 

[disneysteve]

If you are named as beneficiary, transfer on death, then yes having the death certificate should be sufficient.

Otherwise you need to have some documentation that shows you are the estate representative per the will. Yes, talk to the lawyer who prepared the will. This will allow you to complete the rest of the steps.

You will also have to file taxes for the year of death for the deceased person. Who does the taxes now?

Thanks.


He does his own taxes. I've already spoken to my accountant and he will handle the estate taxes.

 

[audreyh1]

You might not need to file an estate tax. But you will have to file a final 1040 for the year he dies.

 

[disneysteve]

You might not need to file an estate tax. But you will have to file a final 1040 for the year he dies.

Understood.


Will I need to establish any sort of estate account for paying any expenses? What about selling the house?

 

[Sunset]

Be sure to have a POA now and go empty the safe deposit bank (if any). As the bank will freeze access if you show up with a death certificate.
Causes a real problem if the Will is inside the safety deposit bank.

Frankly, I'm interested in this subject as it will be useful in a year approximately.

 

[HarveyS]

I'm sorry you are in this position. Loss of a loved one is never easy.
The estate seems substantial. As pointed out, talk to the atty. that wrote the will. If you are comfortable with them, they should be able to direct you through the process. Be careful if you and your loved one are in different states. You may need two lawyers to be sure you are advised on the law in that state. My advice: don't be penny wise and pound foolish. Hire professionals (legal and accounting) to work through this.

 

[EastWest Gal]

When he dies, get multiple official copies of the death certificate. When my dad passed, I registered the will with the county and got multiple copies of the will made at the recorders office. I found that every bank and brokerage needed one. Also copies of the will naming you the Executor. It's a good idea to get a P.O.A. now, as it makes it simpler. Add your name to the bank account as POA. When your friend passes, open a new account, an estate account, using the will and the death certificate. There may be expenses for the estate, including funeral costs, which need to be paid from the estate. It's easy to pay from the estate if the money is in the account.

Nolo Press has an inexpensive book called The Executor's Guide. It will probably help you more than we can. I settled an estate with the help of a local attorney. But that was 12 years ago.

 

[Whisper66]

Do yourself a favor and buy "The Executors Guide" off the NOLO site .... https://store.nolo.com/products/the-executors-guide-exec.html . It's an easy to follow, step by step discussion of executor duties and how to manage them. Can buy an electronic copy and download it immediately or buy a hardcopy. I just got done reading it, excellent guide.

 

[Souschef]

When he dies, get multiple official copies of the death certificate.
.

Get the death certificates from the funeral home. It is a lot less expensive than getting copies later.

 

[disneysteve]

Be sure to have a POA now and go empty the safe deposit bank (if any). As the bank will freeze access if you show up with a death certificate.
Causes a real problem if the Will is inside the safety deposit bank.

I do have POA and there's no safe deposit box so we're good there.

 

[disneysteve]

I'm sorry you are in this position. Loss of a loved one is never easy.
The estate seems substantial. As pointed out, talk to the atty. that wrote the will. If you are comfortable with them, they should be able to direct you through the process. Be careful if you and your loved one are in different states. You may need two lawyers to be sure you are advised on the law in that state. My advice: don't be penny wise and pound foolish. Hire professionals (legal and accounting) to work through this.

The estate will be right around $1.2M.


We are in different states. The lawyer who handled his will is local to him (FL). Is there a reason I'd also need a lawyer in my home state (NJ)?


I've already got an accountant and he is qualified to handle things in FL and NJ.

 

[disneysteve]

When he dies, get multiple official copies of the death certificate.



Also copies of the will naming you the Executor.


It's a good idea to get a P.O.A. now, as it makes it simpler. Add your name to the bank account as POA.


When your friend passes, open a new account, an estate account, using the will and the death certificate. There may be expenses for the estate, including funeral costs, which need to be paid from the estate. It's easy to pay from the estate if the money is in the account.

Nolo Press has an inexpensive book called The Executor's Guide. It will probably help you more than we can. I settled an estate with the help of a local attorney. But that was 12 years ago.

Thanks for all of this. I am named POA in his paperwork but I'm not on any accounts.


What's the deal with the estate account? Does it matter for tax reasons or other reasons how estate expenses are paid, especially since I'm the sole beneficiary? Couldn't I just pay for the funeral out of my own funds. Either way all the money left ends up with me eventually.


And thanks to both of you who recommended the book. I'll get a copy of that.

 

[audreyh1]

Thanks for all of this. I am named POA in his paperwork but I'm not on any accounts.


What's the deal with the estate account? Does it matter for tax reasons or other reasons how estate expenses are paid, especially since I'm the sole beneficiary? Couldn't I just pay for the funeral out of my own funds. Either way all the money left ends up with me eventually.


And thanks to both of you who recommended the book. I'll get a copy of that.

Yes, you can pay for everything out of your own funds. The estate account might be needed if a check was received made out to the deceased, or estate of the deceased. Otherwise not needed.

 

[rk911]

I have a terminally ill relative for whom I am the executor and sole beneficiary. I have a full breakdown of all of his financial accounts, where they're held, how to access them, who to contact, how much is in each one, etc.


What I don't know is what do I actually do after he dies? Can I just walk into his bank, for example, with a copy of the death certificate and close out his account? What about his Vanguard retirement account?


He also owns two individual stocks for which he holds the certificates - they aren't with a brokerage. What do I need to do to get them into my name and be able to sell them?


He does have another retirement account held with a money manager and I've already been in touch with that person. Once my relative dies, I'll call that guy and I'm sure he'll walk me through what I need there.


I am named as beneficiary on all accounts that can have a beneficiary. Everything else is left to me in the will.


And what about the will? Do I call the lawyer who prepared it?


Any guidance would be greatly appreciated. Fortunately, I've never had to deal with any of this before.

having done this three times and about to embark on the 4th i can tell you that requirementa will vary from institution to institution. aome random thoughts for you:

- i would notify the lawyer who prepared the will and, hopefully, a trust. my understanding is that in most, maybe all, states, a trust means the estate avoids probate. if there is no trust then you may have to go thru probate. the lawyer can advise you.

- make a list of of who to notify. insurance, ultilities, friends, family. easiest way is to go through the mail. my first time doing this i was surprised at how many notifications (non family or friends) there were.

assuming there is a trust....

- the trust most likely has the SS# of the creator. upon his death you'll need to get a new TIN assigned to it as the trust is its own legal entity now. final tax returns for the now deceased person as well as federal and potentially state death taxes will need to be paid.

- some institutions may require an original death certificate but most will accept a photocopy. offer photocopies first, originals can be expensive.

- most will want to see the pages that create the trust as well as the signature page. this is usually the first (Declaration page) and last pages of the trust.

- most will want to see all or part of the will.

- there were 5-beneficiaries in one of the trusts i handled. in that case i opened a bank account under the new TIN for the trust. all of the revenue from selling shares, stocks, bomds, the house, cars and other assets were funneled into this account and checks were then written to the beneficiaries. consider doing the same even though you are the sole beneficiary. i would avoid mingling the inherited $ with your own until all taxes are paid and the estate closed.

- the most difficult time i had with one trust was paying off medical providers (another reason for creating a new bank account). well, not paying them per se but identifying them. the deceased person's medical insurance company (too young for medicare) compounded the problem by allowing medical providers 18-mos from the date of service to file a claim. it took me 18-mos waiting for claims from medical providers i had not identified (you don't know what you don't know) before i could make final disbursements.

- i hired a CPA for the taxes and assigning a new TIN to the trust and other matters. i also had an attorney familiar with the trust on an as-needed basis to answer questions that came up.

- if the deceased was receiving SS, railroad or military pension the funeral home handling the burial or cremation should make notification of death to those agencies. expect to make a refund to one or more of them.

- retirement accounts and life insurance are usually not placed within the trust and have their own POD or beneficiary lists. all that is usually needed is a death cert (copies).

- some institutions may want your signature on forms and some of those may want a medallion signature guarantee. your bank may be able to help with that.

keep good records, copies of everything for at least the remainder of the calendar year in which the trust is settled + 10-years (advice from both my cpa and atty).

good luck.

 

[Doribe]

This is my recollection.
1. Talk to the relevant official about the death certificate. In our case it was a police officer, but it could be someone from the hospital. They asked for date and location of birth and the doctor's name.
2. Request several copies of the death certificate to use as proof for each financial institution that you deal with.
3. File a copy of the will (and trust) with the County.
4. Request an estate tax number and open a checking account for the estate. I used this to pay bills and collect funds before dividing between heirs.
5. Contact each financial institution, and ask how to transfer the funds.
6. It has been awhile since I had to deal with stock certificates. When my DF died we found a bunch of valuable certificates in the trunk of his car mixed in with all kinds of newspapers and such. They were signed by the executor and sent to the companies. The companies split the shares and divided them between the heirs. At that point I owned the stock in book form. I eventually moved my shares into a brokerage but I can't remember the details. Call Investor Services for the companies invested in.

In my case there was a trust that held the real estate so I was able to sell it as the Executor. I also had a Small Estate Affidavit for an estate (outside of the trust) of less than $100k. I had to do something like get it stamped by the county in order to get access to a checking account.

This may vary by state.

 

[disneysteve]

Yes, you can pay for everything out of your own funds. The estate account might be needed if a check was received made out to the deceased, or estate of the deceased. Otherwise not needed.

Ah. That makes sense.

I’m also going to have to notify SS and his pension plan of his death so they stop paying.

 

[disneysteve]

Thanks so much to all of you for your responses. Great information and much appreciated.

 

[audreyh1]

Ah. That makes sense.

I’m also going to have to notify SS and his pension plan of his death so they stop paying.

Yes, you must notify them. Funeral home should notify SS.

The funeral home provided death certificate originals for DF. I had plenty of copies. Many institutions will require a coy.

We had a simple will, no trust, financial accounts set up as TOD and I was already on the checking account with right of survival so that caused no problems. I worked with DF’s lawyer and went through probate court with was simple.

 

[38Chevy454]

Just a clarification, the POA is for when your relative is alive. It becomes invalid once he dies. POA is used to enable you to take care of things when he is not capable. Should have both medical and financial POAs. As said, if no trust, then you have to go through probate. Trust doesn't avoid taxes, it just helps avoid probate.

In general the more preparation you can do now, the easier the process later. Good job on asking here and getting valuable suggestions.

 

[Montecfo]

If you can become joint on the checking account now it makes it easy to pay bills post death. That way the account does not get frozen on death and you can easily pay bills

Talk to your broker about what is needed to transfer the individual shares. If you need stock powers completed it may be easier to have the stock powers completed now or alternatively to assign the shares to his brokerage account for which you are beneficiary..

 

[Brat]

A POA dies with the grantor. Not worth a nickel once the person has passed.

 

[Bamaman]

If you get down to it, some estates can avoid probate if there's no home or real estate to liquidate--if you're a co-owner or check signer on all his accounts.

Probate is essentially where a judge gives the executor the right to sign for the deceased person in order to liquidate assets. Of course they'll want to make sure all liabilities have been paid, especially state and federal taxes of all kinds. And in most states, there has to be a couple of public announcements in a newspaper or valid legal publication giving notice of the death and claims and liabilities must be made to the executor by a specific date.

Time is of the essence because you'll have to get the estate an EIN # and file a secibd income tax from the date of death until the funds are dispersed. And I believe income taxes on estates are at a higher rate than personal income taxes.

Good luck to you.

 

[Sunset]

If you can become joint on the checking account now it makes it easy to pay bills post death. That way the account does not get frozen on death and you can easily pay bills

Talk to your broker about what is needed to transfer the individual shares. If you need stock powers completed it may be easier to have the stock powers completed now or alternatively to assign the shares to his brokerage account for which you are beneficiary..

Agree on the checking account as it would make it easy to pay the bills.

OP needs to remember that the stocks will probably have a step up in basis upon death of the owner. A tax advantage that would be lost by transferring or possibly lost by sharing ownership.

 

[Sunset]

I got 10 death certificates when Mom died, and I ran out, and had to get more. ...