After death check list

This checklist should make the processes you have to deal with after someone's death easier.

It is helpful to keep all important information in one place and let the person close to you know where you keep it. It is helpful if the information is updated as soon as something changes.

Immediate steps:

1. Contact close family and friends.

2. Contact the deceased's treating physician.

3. Contact the deceased's lawyer.

4. If deceased had minor children or other dependents, arrange care for them.

5. Arrange care for pets if any.

6. Locate will/letter of instructions- this will go to the layer.

7. Locate durable power of attorney and/or living will.

8. Locate instructions for funeral or memorial services.

Next steps:

1. Order (at least 5) certified copies of death certificate. The copies can be requested by funeral director, local department of Health or State department of health or the Vital Statistics office of the state. Usually one copy is needed per each transfer of each major asset (like car, land or bank account) but also insurances or annuities. Ask if non-certified copy is sufficient or if a certified copy can be returned.

2. Locate list of all assets (bank accounts, insurance policies, annuities).

3. Locate deposit box.

Safety deposit box access after death in TN:

T.C.A. § 45-2-905 (c) Upon the death of the sole or last surviving lessee of a safe deposit box, access is authorized as follows: (1) The duly qualified executor or administrator of the lessee may have access to and remove contents from the safe deposit box, without inventory unless an inventory is required by the lessor or by court order; (2) In order to search for and remove any written instrument purporting to be the lessee's last will and testament, or any writing relating to a burial plot or burial instructions, or any writing purporting to be an insurance policy on the life of the lessee, a lessor shall permit a person named in a court order for that purpose, or if no order has been served upon the lessor, the lessee's spouse, parent, adult sibling or adult descendant, or a person named as executor in a copy of the lessee's purported will provided to the lessor, or any person with a right of access to the safe deposit box immediately prior to the death of the lessee, to open the safe deposit box with an officer or employee of the lessor and remove the documents. A record of items removed from the box by the person authorized entry shall be made by the lessor and the other person. If a purported will is found that does not name as executor the person conducting the will search with the lessor's representative, the lessor may make a copy thereof and mail or deliver it to the executor named therein, or to the court having jurisdiction of the decedent's estate according to the decedent's domicile as declared in the instrument; and (3) If an executor or administrator of the lessee's estate has not requested access to the contents within sixty (60) days following the lessee's death, the lessor may then permit access by the surviving spouse or any next-of-kin of the lessee for the purposes of inventory and the removal of contents. Prior to removal, an officer or employee of the lessor and the surviving spouse or next-of-kin of the lessee shall inventory the contents of the box and prepare a record thereof to be retained by the lessor.

4. Forward mail.

5. If you are the executor of the will, locate all documents necessary for paying the property taxes and the final tax return. The administrator of the estate must pay any taxes owed by the decedent at his death or owed by the estate until it closes.

If there anything going through probate, in TN the executor cannot represent himself in probate court and you will need help of probate attorney.

There is no time limit to file the will with the probate court in TN.
The executor:
1. Has responsibility to inventory the estate and provide that inventory to the probate court.
2. Pay all bills and obligation the estate has pending before distributing assets.
3. TN does not require all wills to be probated. The probate will be necessary for all assets which are solely in descendants name.
4. See link for probate exceptions (non-probable assets).

List of documents to locate:

Legal papers:

1. Will/Trust
2. Final instruction letter, durable power of attorney, living will
3. Pre-paid funeral contracts
4. Social security number or card
5. Birth certificates of all family members
6. Marriage certificates
7. Driver’s license / passport

Access information:

1. Passwords to computer, cell phone
2. Home security system information

Deeds and titles:

1. Real estate property deeds
2. Mortgage document
3. Any loans
7. Vehicle titles and registrations (car, RV)



Insurances:

1. Insurance policies (life, accidental, disability with death rider)
2. Employers or pension insurance
3. Health, dental, long term care insurance
4. Property insurance (car, home)
5. Annuities

If you can recover insurance documentation, use TN online recovery services


Financial accounts:

1. Bank accounts (checking, savings, CDs)
2. Investments/brokerage accounts
3. Retirement accounts (401k, IRAs)
4. Stock and bonds certificates if any
5. Credit card accounts


Keep monthly bank statements of all individual and joint accounts that show the account balance on the day of death which will be needed for the last individual and for the estate tax return.


Other accounts:

1. Professional memberships
2. Magazine and other subscriptions
3. Social media accounts
4. Honorable discharge papers for a veteran and/or VA claim number (if veteran)




Organizational:

1. List of all recurring bills with due dates and how they are usually paid
 (electricity, heating, water, garbage, lawn care, cable, Netflix, house alarm, cell phone, land line, car and home insurance)
2. Loans (mortgage, car loans)
3. All credit cards
4. Cancel services which are no longer needed (cell phone)

Executor:
 - Keep detailed records of all bills paid
 - Contact probate attorney. With the will and the executor named, the attorney will have the document admitted to the probate court. If you have probatable assets  inventory of all assets will be made and will be filed with the probate court.

Cancel:

1. Cancel no longer needed services (cell phone ect)
2. Credit and debit cards (after cancelling services or  transferring recurring bills to your accounts).
3. Driver’s licence
4. Email and social media accounts

Change:

1. I the deceased was beneficiary on your bank and investment accounts, insurances, annuities and retirement accounts (401k, IRAs) change the beneficiary.
2. Change utility bills in your name (if applicable).

  

Who do you need to notify and ask for death or survivor benefits if available:

When calling keep records of date called and requirements.

1. Social security administration (notify of death and apply for death or survivor benefits. The payment of the month of the death must be returned, contact the bank to return that payment. That will be prorated to reflect only the lived portion of the month. There is also a one-time payment of $255 to the survivor).

2. Medicare (If deceased received Medicare the Social Security office will notify it. If the deceased was enrolled in Medicare Prescription Drug Coverage (Part D), Medicare Advantage plan or had a Medigap policy, contact these plans to cancel). Medicare in TN: (TennCare) estate recovery - submit form (money used by TennCare for care you received while you were living will be recovered from the estate with Estate Recovery program).

3. Health insurance (make sure the coverage of the dependents continues).

4. All insurance companies (car, life, long term care, disability... ask for any unused premium to be returned to you).

5. Employer (ask for any possible death benefits or pensions and ask if pension benefit includes survivor payments).

6. If the death was result of criminal act, contact  Criminal Injuries Compensation Program which helps with costs of medical services, loss of earnings, burial costs, and other financial losses incurred as a direct result of personal injuries sustained by a criminal offense. Eligible crimes generally include, but are not limited to, homicide, aggravated assault, sexual assault, robbery by force, and drunk driving.

7.  Credit Bureaus (Equifax, Experian and Transunion) - no benefits, just notify

  

Estate Taxes:

Federal government imposes an estate tax on the value of estate property (except trusts). Starting in 2016 the IRS requires those with estates exceeding $5.45 million in assets to pay estate taxes.

Starting in 2016 there is no state estate/inheritance tax in TN.

What is the difference between estate tax and inheritance tax?

The estate tax is assessed before the assets are given to the beneficiary or beneficiaries. It is paid from the estate money before the estate is distributed to the beneficiaries.

As of 2018 the combined gross assets have to exceed $5.6 million. 
The inheritance tax applies after the assets have been inherited. It is paid from the inherited money and each beneficiary pays it on the received amount.

Not all states have inheritance tax. TN has none.  



Based on that information, taxes are not going to be the reason for me to set up a trust if the estate value is less than $5.6 million (in 2018).
However making the most of your assets are non-probatable is not a way to avoid estate tax. For example, half of the amount in a WROS account will be inherited money which can trigger estate tax if the amount is high enough.  

Do I need a trust? Are there other ways to avoid probate?

As you can see from the previous post I am in the process of organizing everything so that in case of death there is a plan instead of a confusion. 

As I was going though the assets, a question arose if I should have a trust. I know that one of my friends has a trust. He had to work quite a bit with his lawyer to set it up.  When he wanted to make some changes, he had to work with the lawyer again. 
Is this hassle worth my time and money? 

The main reason to have a trust is to avoid probate. Probate is a court supervised process at the end of which the assets will be distributed to heirs. The probate processes can be long and costly and may require a probate attorney. 

If assets are only in the deceased name, everything will go to probate. Probate takes time and money.  Depending on where you live, probate process can cost 10% or more of your gross assets. 

Having a will is not a way around it. The will has to go trough probate. 

The purpose of a living trust is to avoid probate and to reduce attorney fees. Setting up a trust requires time and attorney consultation. All accounts should be re-titled to the trust. 

It sounds like a trust is good solution, but let see first if really everything goes to probate and if it is possible to avoid probate without having a trust? 

There actually some non-probatable assets which do not go trough probate at all. 


Probatable assets: 
Property owned solely by descendant (real estate, car, bank accounts, insurance and also thighs like jewelry, collectibles, furniture).

Non-probatable assets:

1. Property held in joint tenancy or as tenants by the entirety.

2. Bank and brokerage accounts held as tenants with right of survivorship (WROS), or with transfer on death (TOD) or payable on death (POD) beneficiaries.

3. Life insurance and retirement accounts with designated beneficiaries. 

4. Property held in a trust.


Based on that, almost all my assets can be made non-probatable. 
All our insurances and retirement accounts have designated beneficiaries. 
Almost all other accounts are WROS. 
And almost all property is held joint, except one of cars which is very old. 
I would not even know which additional assets I would  put into the trust, because I don't have any other assets. 

It looks like I don't need a trust if the only reason to have it is to avoid probate. 
Few things which might still go to probate are very few like that old car. What I will do next is to make sure that all accounts and assets are non-probatable (see the to do list below).   


Here is a to do list if you want to avoid probate on most of your assets and don't want to bother with a trust:

1. Have both spouses names on all checking and savings accounts.
2. Have all brokerage accounts as Joined With Right Of Survivorship (WROS).
3. Have designated beneficiaries for all your retirement accounts (401k, IRAs, and other including HSA).
4. Have designated beneficiaries on life insurance.
5. Make sure that all property (house, cars, land) are owned jointly.
6. If you have any other assets or accounts, check if similar rules apply to those assets.


If you want to add your child to the deed of the house or as joint owner on the brokerage account, the half of the account or house value will be immediately considered a "gift" and will trigger gift tax. Since the threshold for the estate is relatively high, it might be a better decision not to add children as joined owners.


In summary,
For a childless couple to make all assets non-probatable will be enough and a trust will not be needed. Unless they care enough about the person who will inherit the estate to save him/her the hassle and costs of the probate.

For a couple with children where the child will (most likely) not be a joined owner of the assets, a probate may be useful. We have a child and later this year I will look into the trusts. 
So far I know that setting up a trust requires a lot of time for transferring all assets (including changing property deeds) into the trust and the lawyer fees of approximately $4,000-5,000.    

Planning for AFTER retirement - do I need to do anything?

Planning for retirement takes time.
What about planning for after that? 
Or what about if you die even before you get a chance to retire? 
Should you care?

You might not care very much if you should die first. But if your spouse dies first, do you have a plan? 

So again, should you care?
If your spouse dies, being organized will help you.
If you die first, being organized will help your spouse. 
If you both die at the same time, it will help your children.

The death will either come as sudden and unexpected or as slow, protracted, and expected.

For the sudden option, it is definitely good to have everything prepared and set. There will be no time to ask questions or change anything. 
For the slow option you might have time, but you may be busy with other issues related to the sickness. 


It is good to just bring everything in order as soon as possible. After that, to stay current, updates will be needed as soon as something changes or at least once a year at the time of tax preparation.

I would separate the preparation in following categories.
1. Assets (mainly property and bank accounts).
2. Liabilities (mainly recurring bills and credit cards).
The additional category which is not directly connected to money but still important is 
3. Account access (logins and passwords).


1. Assets
If assets are only in the deceased name, everything will go to probate. Probate takes time and money.  Depending on where you live, probate process can cost 10% or more of your gross assets. 

I am in process of organizing our assets. We have a will, power or attorney and the living will. 
We don't have a trust. But do we really need one? See my answer to this question here.    


2. Liabilities
Recurring bills billed to a joint checking account should not be a problem. Those which a billed to a credit card account which only one one of the spouses owns might become difficult. See how I am organizing this here.


3. Account access (logins and passwords).
With some services you may need to log in to change the billing information. Some people recommend secure or locked apps to keep all passwords. It is a good solution, but remember you will also need the password to that app to open it. I think a paper copy kept secure somewhere in the house is still a good back up option.   


It will take some time to set up everything, but slowly one thing after another, working with a good to do list it could be done. I am giving myself 2-3 months to get it all finished.