Tag Archives: Settle an Estate

Are your loved ones protected when you die?

last-will  Larry and Susan had been living together for more than 20 years.  They never legally married; they said once had been enough.  A piece of paper wouldn’t change how they felt about each other.  Larry had been married before and had two sons.  Susan had also been married previously and she had a daughter.

When Larry’s father became incapacitated, they moved into his house to take care of him.  His father, to thank them for all they’d done, left the house to Larry in his will and named Larry beneficiary of his life insurance policy.  When his father died, Larry inherited the house and Susan and Larry continued to live in the house.  Larry promised to deposit the check from the insurance company into their joint bank account as soon as it arrived.

As Larry was crossing the street on his way home from work one day, he was struck by a car driven by a drunk driver and he died almost instantly.

Larry didn’t have a will and had not left any legal document naming Susan as his heir.  They lived in a state that did not recognize common law marriage so, when he died, his sons inherited everything.  They forced Susan to move out of the house and refused to give her any of the proceeds from the life insurance policy.  In essence, Susan was left with almost nothing!

Families today are very complex.  Some are the traditional married mother and father in their first marriage.  Many more are couples who were previously married to other spouses or who are legally married gay couples.  However, many people live together without benefit of a legal ceremony. This mixture of circumstances makes inheritance much more difficult and complex.

The only way to be sure your loved ones are protected is to prepare a will or a trust naming the person(s) you want to inherit your assets when you die.  Otherwise, state law will dictate who receives what.  Not you. It’s frightening that more than half of the people living in the United States today do not have a will and have not protected their loved ones. You can find a simple will form on the internet or can meet with an estate planning attorney to discuss the options that are best for you.

Don’t be like Larry.  Act now so those you love will be protected when you’re gone. For more information about wills and estate planning, go to www.diesmart.com.

Estate Inventory


The person in charge will need to make an inventory of the estate.   This inventory is critical to the entire estate settlement process.  The inventory will:

  • Identify whether a Last Will and Testament, Codicil, Living Trust or other legal documents exist.
  • Capture basic information about the deceased, a surviving spouse and other relatives of the deceased.
  • List what property the deceased owned, how the property is titled, what percentage the decedent owned, the fair market value of the asset, and any debts the decedent owes.
  • Identify what assets are probate assets, what assets have automatic inheritance rights, and what assets are trust assets.
  • Identify the  location of the tax returns and other documents.
  • List any income the decedent receives, including social security benefits

The following questions and answers can help a family member or estate representative prepare the estate inventory.

Q. Where can an executor or family member get the information required to complete the inventory?

A. Hopefully the deceased prepared a Family Treasure Map before he died.   If not, the executor or family member will need to search for information and documents to help them create the inventory worksheets.

  • The checkbook and prior cancelled checks
  • The mailbox
  • Paper files
  • Conversations with professional advisors:  tax preparers, lawyers, doctors
  • A safe deposit box
  • Conversations with business partners
  • E-records

Q. What assets are included in the inventory?

A. Everything the decedent owned, or had an interest in, including:

  • real estate deeds, insurance, condominium bylaws, and property taxes
  • checking and savings accounts and any checkbook
  • cash, including coin collections
  • annuities
  • brokerage accounts
  • savings bonds
  • life insurance policies
  • certificates of deposit
  • vehicles
  • jewelry
  • art
  • other collectibles
  • household inventory
  • accrued wages, unpaid vacation and sick pay
  • retirement plans, including 401(k)s, IRAs, 403(b), even though a beneficiary is named
  • benefits, including social security and VA benefits
  • property in another state or country
  • anything in a safe deposit box
  • health savings account
  • debts owed the deceased

Everything the decedent owes:

  • credit cards
  • student loans
  • medical bills
  • child support
  • alimony
  • mortgages
  • car Loans

Include any gifts the decedent made in the two years before his death.  This information is needed to calculate the federal estate tax value of the estate.


Q. How do you assign a value to each item?

A. Once a list of the assets is made, someone should assign a fair market value to the estate property.  The fair market value of the property is the price someone would pay to purchase a particular piece of property.  Different types of property have a different method for calculating the fair market value.  A family member or estate representative may determine the fair market value used in the inventory.  Or, the estate representative may hire someone to determine the fair market values to be used in the inventory.

If the estate has valuable personal property, such as antiques or jewelry, you may want an appraiser to complete an appraisal form.

The fair market value is used  to calculate the probate value and the estate tax value of the estate.

Each asset must be valued as of the date of death of the decedent.  For federal estate tax purposes, the estate may also be valued six months later and the lower value may be used to calculate the federal estate tax.


Q. Who can access the safe deposit box?

A. It depends on how the safe deposit box is titled.

  • If the decedent owned the box as joint tenants with right of survivorship, a surviving joint tenant has the right to access the box.
  • In many states, the executor or other family members may need a document from the probate court authorizing the bank to give access to the executor or family member.
  • In some states, a bank representative must take an inventory of the box.
  • If a trustee owns the box, the successor trustee has the inherent legal right  to access the box.


Q. How do you calculate the probate value of the estate?

A. Different states have different rules on how to calculate the probate value of the decedent’s property.

Some states use the fair market market value of the estate, which is sometimes described as the gross value of the estate.   Other statues use the net value of the asset as the probate value.  The net value of the property is the fair market value less secured liens..

For instance, John dies.   A real estate appraiser establishes a fair market value of $750,000 for his personal residence.   When John died, the mortgage secured by the personal residence was $400,000.

If the state probate rules use the net market value as the probate value of the estate, the probate value of John’s personal residence is $350,000 ($750,000 minus $400,000.

If the state probate rules use the gross value as the probate value, the probate value of John’s personal residence is $750,000.

Some states exempt personal residences considered as a homestead from the probate estate calculations.   Funeral expenses and family allowances may also be exempt from the probate calculations.


Q. How do you calculate the estate tax value of the estate??

A. The federal estate tax value of the estate is calculated in the same manner in all states.   The estate tax page explains how to calculate the estate tax value of the estate and determine if the estate is subject to estate tax.

Fact:   Fair market value of stocks

Historical stock values are available at: http://finance.yahoo.com/


Helen and Les Brown were born on the same day, remained married for 75 years and died just one day apart at age 94.  What a wonderful story of true love.  It would be great if there were more couples like them in the world.

75 year marriageBut, while thinking about this great couple, being a part of the Die Smart community I can’t help but think about their estate.  It’s bad enough if one person dies and a family member has to settle the estate, including dealing with lawyers, probate court and the mounds of paperwork that are necessary.  But the double work of settling the estates of two people can be massive.

Did they have wills, trusts, POD accounts?  Will one estate have to be settled before the other one?  Did they have their affairs in order?

To learn about what you should do to make sure you can avoid probate and make it easier for your loved ones to settle your estate after you’re gone, go to diesmart.com.

5 things you should know before you agree to be an executor

When my father died ten years ago and I found out he had named me as his executor, I thought “Okay.  It’s no big deal.”  Was I ever wrong!  I didn’t realize how much time, effort and frustration would be necessary to get everything settled. And I didn’t know that I would also have to be a detective.

 AARP recently published an article that listed five questions you should ask yourself before you agree to become an executor.   You might feel flattered if asked but think carefully about the questions and be sure it’s something you’re comfortable taking on.

1.  Do you have the time to take on this project?  When I started the process, I didn’t realize that it would be more than a year before my dad’s estate would be settled and that, during that year, getting all of the paperwork done and answering all of the government’s questions would often feel like a full time job.

2.  Do you have the skills to handle the process?  You have to be very organized and good with numbers.  Keeping massive spread sheets and tracking all of the paperwork nearly drove me crazy.

3.  Do you have the temperament to deal with all of the details?  I am a fairly calm, easy going person but I found myself getting very frustrated when confronted by people who made ridiculous demands.  One example I can remember is when the state of New Jersey (where my father died) asked me to sign a bunch of papers in black ink, get them notarized and send them in.  I did that and was shocked when I received a letter from a government office saying that I needed to resign them in blue ink, get them notarized again and send them back.  I did it and got one more letter.  It told me that I had not completed the forms correctly.  Believe it or not, it the letter said that the forms needed to be signed in black ink! 

4.  Do you know the rules of the state in which the estate is being settled?  Estate rules are very complex and I ended up hiring an attorney to help me get everything processed correctly.  Many people take this step after realizing what is involved.  For example, if you incorrectly declare the value of the estate, there can be legal repercussions, not just for the estate but for you as well.

5.  Can you afford to be the executor of the estate?  I lived in California and my dad died in New Jersey.  Some things just couldn’t be handled by phone; this necessitated a few expensive trips back and forth across the country.  And it’s not just the money.  What’s your time worth?  Can you afford to handle this job for nothing?  In some states, executors are permitted to charge a fee that is a percentage of the value of the estate.  However, since this money comes out of the estate, taking a fee may cause conflict with family members.

If you agree to be an executor, be prepared to devote a great deal of time to the project.  Be patient and don’t let little things get to you.  Stay organized and check every detail.  You will get through settling the estate…eventually.

For more information about estate planning and settling an estate, go to www.diesmart.com.


Need a death certificate? Here’s how to get one.

Someone wrote to us at diesmart.com and said she needed help finding an attorney so she could get an original death certificate of a deceased relative.

A death certificate is the official certified document which is filed upon a person’s death.  You might wonder why she would need an original or certified copy.  There are several possible reasons; here are just a few of them.

  • To settle an estate
  • To end government services such as Social Security or Medicaid
  • To collect on an insurance policy

We may not know the exact reason she needs one but there is one thing that is certain; she definitely doesn’t need an attorney to get a death certificate.

Here are the simple steps that she, and anyone else who needs one, should take.  There are several websites that offer to help you obtain copies of death certificates.  However, those copies are not certified or “official”.

1.  Determine whether you are eligible to receive a death certificate.  In most states, you must be a surviving relative of the deceased, their authorized representative or executor, or a funeral director in charge of the disposition of the deceased.

2.  Find the contact information for the department of vital statistics in the state where the person died.  This department may be part of the state’s department of health and human services or the state’s records department.  Regardless of its name, it is where all births, deaths, marriages and divorces are recorded for that state.  You can usually find the contact information by searching the web.  You will need the mailing address for submitting a request and, if you have questions about the process, you should also find their phone number.

3.  Some states require a letter with a great deal of information about the deceased as well as the requestor.  Others have a form available online which can be downloaded.  Regardless of whether it’s a letter or a form, you will have to provide the necessary information and either mail it to the facility or take it there.

Here’s the information that must be provided:

  •  Full name of the deceased
  • Date of the request
  • Deceased’s date of birth and date of death
  • Location of the death (city, state, county)
  • The deceased’s gender – male or female
  • Your relationship to the deceased
  • Why the certified copy of the death certificate is needed
  • A copy of your driver’s license or, at least, your driver’s license number and issuing state
  • Your name and current address
  • Your handwritten signature

4. Write a check for the amount due.  Most states charge between $10 and $15 per certified copy and it usually takes a week or 10 days for you to receive the copy.  In addition, some states offer same day service for a higher fee.

5.  Place the completed application or letter in an envelope, along with any identity documents and a check or money order to cover the fee.  Also enclose a self-addressed stamped envelope in which the certificate you’ve requested can be sent to you.  Mail this material to the department address which you obtained earlier.

Although a lawyer may be very helpful in resolving many of the issues that arise after someone dies.  However, he or she is not needed if you only want to receive a death certificate.

For more information about death certificates, go to www.diesmart.com.