Long time lurker seeking advice from any tax experts or estate experts on what to do, if anything, about my recently deceased siblings’ creditors and final taxes. To the best of knowledge, my brother’s estate is insolvent. He has an overdrawn checking account, no retirement savings, no real estate, no car, nothing of any value. But he has credit card debt, personal loans from friends/investors, a federal small business loan from Covid, and unpaid federal taxes (2020 and 2021). I do not have physical records of his finances. I’m only going by what he told me on his deathbed. If it matters, he was living abroad for the last 5 years and died abroad. Also, I have only incomplete paper records of his finances that I got from his apartment. There is no Will.
My questions are:
- Is it required that a family member file a final tax return(s) for a deceased family member? There is no money to pay taxes and I don’t have accurate income or expense information. He was paid an unknown amount through Paypal by a foreign company as his income source (he said about $39k in 2020).
- Is there any reason to go through probate? Is it required? There is no estate to probate, but maybe the process could assign a court appointed estate Administrator who could then gain access to his bank account and paypal account to prove insolvency and verify 2020 and 2021 income for tax purposes. Is that a possibility? I have no idea. Also, where would I even probate the estate? In the state where he used to reside and where his bank is?
My ONLY motivation for possibly inserting myself into this situation is that my brother occasionally used my elderly parents’ U.S. address. That’s how I determined he had a federal SBA loan when the bills recently arrived at their house. My parents are old and easily stressed, one with dementia, etc. I just do not want them to have to deal with anything – mail, calls, whatever.
A possible second motivation is that it may be the right thing to do. But many times I have found that no good deed goes unpunished.
To help avoid my parents getting harassed by creditors, I have mailed death certificates and letters to his bank and the creditors I do know about, including the SBA, SS, credit card companies, etc. and asserted that there will be no probate of the estate because his estate was insolvent. I have no idea if that is ok to do, but that’s what I did. But I have not reached out to the IRS and have not addressed the IRS final taxes issue. Can I just leave that for the IRS to figure out? Walk away and not deal with anything? I cannot possibly determine his income without better records and access to his bank and paypal accounts. And the IRS requires that a court assigned Administrator or Estate Executor be the person filing the final taxes. So…
Do I notify Paypal and gmail and … ? I don’t really want to spend my own money on attorney or tax consults for any of this if I don’t have to. I am already out considerable money for funeral services, travel costs, medical bills, etc.
My questions are:
- Is it required that a family member file a final tax return(s) for a deceased family member? There is no money to pay taxes and I don’t have accurate income or expense information. He was paid an unknown amount through Paypal by a foreign company as his income source (he said about $39k in 2020).
- Is there any reason to go through probate? Is it required? There is no estate to probate, but maybe the process could assign a court appointed estate Administrator who could then gain access to his bank account and paypal account to prove insolvency and verify 2020 and 2021 income for tax purposes. Is that a possibility? I have no idea. Also, where would I even probate the estate? In the state where he used to reside and where his bank is?
My ONLY motivation for possibly inserting myself into this situation is that my brother occasionally used my elderly parents’ U.S. address. That’s how I determined he had a federal SBA loan when the bills recently arrived at their house. My parents are old and easily stressed, one with dementia, etc. I just do not want them to have to deal with anything – mail, calls, whatever.
A possible second motivation is that it may be the right thing to do. But many times I have found that no good deed goes unpunished.
To help avoid my parents getting harassed by creditors, I have mailed death certificates and letters to his bank and the creditors I do know about, including the SBA, SS, credit card companies, etc. and asserted that there will be no probate of the estate because his estate was insolvent. I have no idea if that is ok to do, but that’s what I did. But I have not reached out to the IRS and have not addressed the IRS final taxes issue. Can I just leave that for the IRS to figure out? Walk away and not deal with anything? I cannot possibly determine his income without better records and access to his bank and paypal accounts. And the IRS requires that a court assigned Administrator or Estate Executor be the person filing the final taxes. So…
Do I notify Paypal and gmail and … ? I don’t really want to spend my own money on attorney or tax consults for any of this if I don’t have to. I am already out considerable money for funeral services, travel costs, medical bills, etc.
