Tag Archives: beneficiary law

Isn’t identity theft just by strangers?

Identity theft of the deceased is a huge problem today. You may think that it is just strangers preying on the families of deceased loved ones. However, it is sometimes those loved ones who perpetrate the fraud.

Last week in New Jersey, Jocelyn Russo, 36, pleaded guilty to using her dead aunt’s identity to gain access to credit card and bank savings accounts. Pretending to be her aunt, Jocelyn used her aunt’s Social Security number and other identifying data to authorize the addition of her name to her aunt’s accounts at Bank of America and JP Morgan Chase.

As her aunt, she added herself to credit card accounts as an authorized signer. She then made large purchases with those credit cards and didn’t pay them off. She also withdrew all of her aunt’s funds from a bank account at Provident Bank.

The three banks involved lost more than $30,000 because of the fraud and, of course, any other immediate family of the deceased suffered emotional as well as financial damage.

Russo is charged with bank fraud and can face a possible penalty of 30 years in jail and a fine of $1 million. She will be sentenced in February, 2013.

If you are the executor of someone’s estate, you should work quickly to notify the three credit bureaus about the death and to ask them to place a death flag on the accounts. You should also contact any financial institutions with which the deceased did business. Once the accounts have been flagged as belonging to someone who is deceased, fraud like the one the Jocelyn Russo perpetrated cannot happen.

For more information, go to www.diesmart.com or look for our book, GRAVE ROBBERS…HOW TO PREVENT IDENTITY THEFT OF THE DECEASED.

Does a loan live on after death?

Although the person is dead, the loan may live on for years…or until it’s paid off. In some instances, death cancels the loan but this is rare. In some states, the next of kin doesn’t just inherit the estate. He inherits the debt as well and is required to pay the debt.

If someone cosigned the loan with the deceased, that person is responsible for the debt. Some loans, such as federal student loans, contain a clause that cancels the loan in the event of the death of the person who signed it.

Private lenders vary on their policies so heirs will have to check the note carefully to find out whether their liable for the debt.

If the loan has been secured with real property, it must always be repaid. Either the bank will repossess the property to cover payment or whoever has inherited that real property will have to pay off the note.

Sometimes banks or other financial institutions will give the cosigner or other family member a few months to decide how to pay off the loan so it’s important to speak with a financial officer quickly so a solution can be discussed.

If the original borrower purchased credit life insurance which pays off the loan in the event of death, there is no problem. The heirs get to keep their inherited property and the loan is paid.

Be sure you know the terms of any loan you take out and what the impact of this loan may be on your heirs if you die before it’s been paid off. Otherwise, you may be leaving your heirs with an unwelcome inheritance – a debt.

Green funerals – Make your last act a “green” one.

Just as people have become more environmentally conscious and have focused on living “green”, many are thinking about a last green act – a green funeral. This is one where the end-of-life ritual does as little harm to the environment as possible.

It can include such simple things as reducing carbon emissions by carpooling to the funeral, encouraging charitable donations instead of cut flowers and selecting a funeral home that has energy efficient methods, recycles and is energy conscious.

Burial can be in a traditional or a green cemetery. If you choose to have a greener burial in a conventional cemetery, you can do so by opting to use a shroud and a simple, biodegradable casket. An eco-friendly casket is usually made of bamboo, sea grass or willow. It can also be made of heavy cardboard or a soft wood such as pine.

May conventional cemeteries require either a vault or a grave liner but there are some conventional cemeteries that are beginning to allow vault-less burial. A compromise is the liner with no bottom, which allows the body or casket to rest directly in the earth.

In a green cemetery, trees or shrubbery is often planted in place of headstones or other traditional markers. This creates a living memorial instead of a “dead” one. A green cemetery is basically a nature preserve that has trails to walk through. There used to be very few of these green cemeteries but the number is growing.

If burial is in a conventional cemetery, choose the smallest headstone allowed and try to find a monument builder who uses indigenous stone to reduce the carbon footprint of production and transportation.

Full body sea burial can also be made greener by not embalming it but merely wrapping the body in a shroud.

If you prefer cremation, there are biodegradable urns that can be used for ground or water burial. They are often made from sustainable, recyclable materials such as Himalayan rock salt and handmade paper. These urns degrade in a matter of days once they are placed in the earth or the sea.

For more information about green funerals, there’s a video from KQED that might be of interest. You can also check out the information from the Green Burial Council.

Have you planned your funeral in advance so your wishes can be followed?

Some famous people have had unusual wishes but, because others knew what they wanted, they were carried out.

Hunter S. Thompson, an American journalist who died in 2005, wanted to be cremated and then shot out of a canon. A 150 foot high canon was constructed and his ashes were blasted out of it while friends sipped bourbon and watched.

Gene Roddenberry, the creator of Star Trek, died in 1991. He requested that his ashes be placed on a shuttle and sent into space. Some of his ashes circled the earth 160 times on the shuttle Columbia in 1992. Earlier this year his wife Majel died and plans were made to send her ashes into space along with more of his.

Liberace was very flamboyant in life and was the same when he died in 1987. Per his request, he was buried in a gold coffin, wearing wig, a white tuxedo and full makeup.

What you want to happen to your body after you die and the kind of rites you want may be very important to you. If they are, make sure you document them and discuss them with close family members. Your wishes may not be as bizarre as Hunter Thompson’s, Gene Roddenberry’s or Liberace’s but, whatever they are, they need to be clarified before you die or you may not have the send off you want.

For more information about planning a funeral, go to www.diesmart.com.

Don’t Pay an Inheritance Tax on Your Own Money!

If you live in Indiana, Iowa, Kentucky, Maryland, Nebraska, New Jersey or Pennsylvania beware. These states tax your inheritance, no matter what the amount is.

Barry and Susan Brown of Philadelphia, PA learned this the hard way. Because they were getting older, they decided to add their son’s name to their bank accounts. They decided this would be the easiest way to enable him to access their funds in case of a health emergency.
Unfortunately, their son died before they did. Shortly thereafter, they received a tax bill for several thousand dollars. Why? Under Pennsylvania law, one third of the money in their accounts was considered to be their son’s. Since, according to the law, they had inherited it, they owed 4.5 percent as tax. Their son had none of his own money in the accounts, but that didn’t matter. They had to pay the tax.

This problem could have very easily been avoided. Instead of putting their son’s name on their bank accounts, they should have prepared a financial power of attorney document. In this document, they could have given their son the right to access their money and make financial decisions on their behalf when they were unable to do so. This method would have allowed them to keep all of their money instead of giving some of it away to the government needlessly.

For helpful information about how to plan for incapacity and death, go to www.diesmart.com.