Friday, January 29, 2010

After Words

Losing a loved one is difficult no matter what the circumstances. When a life limiting prognosis is known, it is helpful to make funeral arrangements ahead of time. However, important financial decisions do not end there. This list is a road map of basic actions you or a designated third party will need to take during the first few months after the death of a loved one.

1. Collect the Necessary Papers
  • Death certificate. The funeral director will provide a certain number. You can purchase additional death certificates through the funeral director or the county health department. At least a dozen certified copies of the death certificate is recommended. Most companies will want a certified copy but use a photocopy when able to save money.
  • Marriage certificate. Available from the county clerk where the marriage license was issued.
  • Birth certificate(s). For the deceased and any dependent children. Available at either the state or county public records office where the person was born.
  • Social Security number(s). For the deceased, spouse, and dependent children.
  • Discharge papers. If the deceased served in the military, a copy of the discharge certificate is needed. If you do not have a copy, contact National Personnel Records Center (9700 Page Boulevard, St. Louis, MO 63132-5200), at the attention of the branch in which the deceased served.
  • Original will. The lawyer who wrote the will may have it or it may be with the personal belongings of the deceased or in a safe deposit box. Be aware that some banks have special procedures before letting anyone in to the safe deposit box.
  • List of property. Complete list of what the deceased owned including real estate, stocks, bonds, bank accounts, deeds, and personal property.
  • Recent income tax returns. If the most recent income tax return cannot be found, you'll need to fill out IRS Form 4506. There is a $57 fee. You'll also need to attach documentation that you are authorized to act on behalf of the deceased, such as letters from the probate court.
  • Find bankbooks or account statements, stock certificates or investment account statements, and insurance policies.
2. Contact Insurance Companies
  • Contact each insurance company to notify of your loved one's death and find out how to claim the policy benefits. Ask what forms will need to be filed.
  • Each company will need a statement of the claim and a death certificate before the surviving spouse or dependent children can receive benefits. Keep copies of all correspondence. If you speak with a claim representative by phone, note the representative's name, date and time that you called, and what was discussed.
  • In addition to life insurance, find out if other forms of insurance covered the deceased. Some loans, mortgages, and credit card accounts are covered by credit life insurance, which pays off account balances. Notify these companies immediately.
  • If you can't find the individual policies among the deceased's papers, look at the checkbook or paycheck stubs for premiums paid.
  • Generally, life insurance proceeds are paid directly to the named beneficiary. Most companies offer to pay the benefits in a lump sum or as fixed payments over time.
  • If the deceased was listed as a beneficiary for your own policy, you will need to change the listed beneficiary.
  • Policies on properties and autos should be changed to the survivor or heir's name.
  • If medical insurance was formerly obtained through the deceased's employment, find out immediately if you are still covered and for how long. If you are no longer covered, ask about options open to you now.
3. Notify Social Security
  • You will need to contact Social Security if the deceased was already receiving Social Security benefits. If a Social Security check arrives after your loved one has died and it is payable to the deceased only, it must be returned. If it is made out to the deceased and surviving spouse jointly, take it to the Social Security office so that it may be stamped "Payable to Survivor."
  • There is a one-time Death Benefit of $255 on the worker's record, payable to the deceased's widow or minor children.
  • Survivors Benefits may be available to the surviving spouse, dependent children up to age 18, and in some cases dependent parents (over age 62, you must provide at least half of their support.)
4. Claim Benefits
  • Veterans benefits. The VA provides burial benefits, including a grave at a national cemetery, the opening and closing of the grave, government headstone or marker, and burial flag. Cremated remains will also be buried or interred. The deceased may also be eligible for a burial allowance. For information on benefits, including those for surviving spouses, contact the Veterans Administration at 1-800-827-1000. Forms can be found at
  • Employee benefits may be available; check with the deceased's employer.
  • Unions and other professional organizations provide benefits as well.
  • Social Security Death Benefit. See above.
5. Begin probate if needed
  • Probate is the court-supervised process of paying the deceased's debts and distributing the estate to the rightful beneficiaries. It may take up to a year to complete so attorney may be helpful. Jointly owned property, property in trust, and assets with a designated beneficiary (i.e. life insurance, 401(k), pensions) do not go through the probate process. If the will is relatively few assets, debts, and only one heir, it will probably not require probate.
  • If the deceased did not have a will, state law determines how the assets and property will be distributed to family members. The court will appoint a personal representative or the executor to manage the deceased's affairs. Contact the probate court in the state where the deceased lived for details.
6. Additional Details
  • Advise all creditors in writing of the deceased's death. This includes credit card and loan companies. Remember, some loans, mortgages, and credit card accounts are covered by credit life insurance, which pays off account balances.
  • See a tax accountant or lawyer. Federal law often requires that an estate tax return be filed within 9 months of the death. Since tax laws are constantly revised, seek out expert service to find out the full tax liability. The surviving spouse may still file a joint tax return noting the deceased's spouse's death that year. The surviving spouse may also claim the death benefit exclusion on the income tax return.
  • Notify banks to change the name to the survivor's only. Ask the bank to release joint bank account funds to you. In some states, joint bank accounts are automatically frozen upon the death of one spouse. If the account is in the deceased's name only, no one may access it until an administrator is appointed.
  • Notify retirement plan administrators of the deceased's death.
  • Change the title on joint assets. Revise your will.
  • If you have dependent children in college, ask them to visit the financial aid office. They may be eligible for increased aid.
  • Motor vehicle. One vehicle is automatically the survivor's property but when the registration expires, you will need to bring a copy of the death certificate, vehicle title certificate, and new insurance form in your name to the Department of Motor Vehicles. They will supply the necessary forms to fill out. Any additional vehicles must go through the estate.
  • Stocks, bonds, and investments. Notify the broker or banker of the death and ask for any appropriate forms. Leave decisions about investments for later, if able.
  • Keep a record of any bills paid and funds received. If you need extra time paying current bills, notify the company as soon as possible.
  • If you have any minor dependents, you must have yourself appointed as custodian of their property, i.e. stocks or bank accounts. The guardian listed in your will should also be updated.
  • Sale of property. If you are able to postpone decisions about selling, please do. Review all options carefully. Avoid people who want to "make you rich."


risaden said...

This is a wonderful and useful list. Do you mind if I copy it?

LeighSW said...

Not at all. I'm submitting it at work to become a handout but thought I'd road test it here first. I need to add a part on the Medicaid benefits so be on the lookout for updates.

Jerry said...

Thanks for this very sound and practical guidance.

Jared Porter said...

Leigh, this blog entry is included in the February 2010 edition of Palliative Care Grand Rounds, hosted this month by the Alive Hospice Blog.


Thank you for sharing such helpful information. The loss of a loved one is such a difficult time, and having some guidance on practical steps people need to take helps make it all easier to navigate. Thank you for that.

Gretta said...

What a wonderful, helpful list. Most people just don't know what to do when they lose a loved one and having it all written down will make it a whole lot easier to deal with.