Expected or not, managing issues that must be addressed following the death of a family member or friend can be extremely difficult. There’s a surprisingly long list of things that need to be addressed and estate planning to manage — all while you’re grieving the loss of a loved one. Some can be handled after the funeral, but much needs to be dealt with immediately. That’s when knowing what to expect and having a plan in place, if possible, will take much of the hardship out of the process.

Your tax professional or financial professional can help alleviate some of the stress that comes from this challenging time. We also recommend reviewing the following list to help familiarize yourself with the process. Each situation is unique, but you’ll feel less adrift knowing you have a step-by-step plan of action to help get you started.

Prior to Death:

Talk to your loved ones as they get older to make sure you understand their wishes after death. It may not be an easy conversation, but it can make a big difference when it comes to handling their estate in the way they desire.

Key things to ask include:

    • How would they like their remains to be taken care of? Do they wish to be cremated or buried, and if so, where? Are they an organ donor? Are there any other wishes you can fulfill regarding a funeral or memorial of some kind?
    • Do they have a will or trust? If not, we recommend talking to them about formalizing their plan for their assets after death and appointing an executor. Unclear instructions for handling an estate can result in costly probate fees and a lengthy process — not to mention the potential for permanent damage to family relationships that often arise when it comes to an inheritance.
    • Where do they keep their important documents? If privacy is important, you don’t need access to them until after your loved one has passed, but knowing where to find key documents like life insurance policies, estate planning documents, deeds and a list of assets can alleviate a lot of stress when you’re handling the estate.
    • The same goes for passwords. A lot of information is stored online these days, and access to accounts to handle assets, turn off services and discontinue memberships are often part of the process. It’s not uncommon to find a handwritten list of passwords, but the use of password management software to encrypt and store all passwords in one location is gaining popularity. If your loved one doesn’t want to share access now, perhaps they can store account and login information in a safety deposit box or other secure location.

Immediately After Death:

  1. Get a legal pronouncement of death from a doctor at a hospital or nursing home. If your loved one was under hospice care, a hospice nurse can also provide that. Otherwise, dial 911 to have them transferred to a hospital.
  2. Contact family and close friends and keep them informed as plans progress. If your family is extensive, ask for help in sharing the news.
  3. Explore wishes for organ donation. Arrangements need to be made almost immediately upon death to ensure the viability of donated organs, so if it isn’t clear what the deceased wanted, check their driver’s license or their advanced health care directive.
  4. Arrange for the care of dependents and pets until permanent plans are put into place.
  5. Safeguard your loved one’s home. Make arrangements to hold mail, lock doors and windows, throw out any food that will expire and water the plants. If the house is in a cold climate, you should also keep minimal heat on to avoid any frozen pipes.
  6. Begin funeral or memorial arrangements. You might want to get help from other family members if the decedent did not make their wishes known, or if arrangements are overly complex.

Factors to consider:

    • What did the deceased want? Were there any written or verbal wishes made?
    • Did the deceased prepay any funeral costs?
    • Is the deceased eligible for VA benefits? Veterans, service members and their dependents can be buried in a national cemetery for free. If the decision is made to bury them elsewhere, the estate may be eligible for a burial allowance.
    • What can you afford? Contact the funeral home to determine costs.
    • What’s realistic?
    • What will help the family most with the grieving process?
  1. Submit an obituary to the deceased’s local paper. If you wish to have charitable donations made instead of flowers you can make that known in the obituary.
  2. Call the deceased’s employer, let them know about the death and ask about potential life insurance benefits or any pay due.
  3. Track all donations, flowers or cards received so you can acknowledge them after the funeral.
  4. Inventory and appraise your loved one’s property (i.e. jewelry, artwork, furniture, etc.) and file it with the probate court within 90 days of death.

After the Funeral:

  1. Obtain death certificates from the funeral home. You’ll need at least 15 to 20 copies to deal with financial institutions, government agencies, insurers, service providers and more.
  2. Notify the deceased’s attorney and find out if a will exists. If so, determine who was appointed executor and organize a meeting to review the will and handle the estate settlement.
  3. If you’re the executor, you’ll need to obtain Letters Testamentary or Letters of Administration as proof that you have a right to work on behalf of the deceased’s estate. An attorney can help you with this process.
  4. Collect the following documents:
    • the death certificate(s)
    • a copy of the decedent’s birth certificate
    • the will or trust insurance policies (life, homeowners, health, disability, auto, etc.)
    • last credit card statements
    • any unpaid bills
    • investment accounts (IRAs, 401(k) plans, mutual funds, pensions, etc.)
    • last checking and savings account statements (including CDs and money-market accounts)
    • last mortgage statement
    • last two years’ tax returns
    • marriage and birth certificates (of the deceased’s spouse and children)
    • an up-to-date credit report of the deceased

These documents will help you find accounts and assets and assess outstanding debts, as well as submit claims for benefits and cash payments that may be due to beneficiaries and heirs.

  1. Contact the following:
    • Trust and estate attorney to learn how to transfer assets and assist with probate issues.
    • Police to have them periodically check the deceased’s house if vacant.
    • Tax professional to find out whether an estate tax return or final income tax return should be filed. Federal taxes must be filed within nine months of death if the estate’s value exceeds the estate tax exemption for the year of death. You may also have to file one more personal return for the decedent.
    • The person’s investment adviser for information on holdings and to change the account registration if necessary.
    • The bank to find safe deposit boxes and accounts; change the registration to remove the deceased.
    • Life insurance agent to get claim forms.
    • The IRS, credit-reporting agencies, and the DMV to prevent identity theft.
    • Social Security (800-772-1213; socialsecurity.gov) and other agencies from which the deceased received benefits, such as Veterans Affairs (800-827-1000; va.gov) to stop payments and ask about applicable survivor benefits.
    • Agency providing pension services to stop monthly checks and get claim forms.
    • Utility companies to change or stop service, and postal service, to stop or forward mail.
    • Home and auto insurance agents to check coverage during the probate process and to restructure policies as needed.
    • Social media companies like Facebook or LinkedIn and email providers to remove an account.
    • Other service providers like cell phone service, internet and cable and other companies that charge fees for memberships, etc.
    1. If necessary, the estate’s executor should open a bank account for the deceased’s estate. Any unpaid bills should be paid from this account. If a family member or friend pays those bills themselves, that will increase the net value of the estate and may mean higher taxes. Once the period has ended for creditors to make claims (as long as one year in some cases), the executor can pay out any assets to the heirs, though it’s important to maintain a reserve for any unexpected expenses.

 

Remember, this list is not all-encompassing. Some estates are more complex to manage than others and each state has unique requirements, but these steps and the help of your tax professional, lawyer or financial advisor will give you a solid place to start.