Estate Planning Essentials: What To Do When Your Spouse Dies
Aside from causing major trauma and grief, the death of your spouse impacts you more than you think. For one, you will be responsible for settling your deceased loved one’s estate. Even if your spouse has a will, trust, or any other kind of estate plan, you would still play a key role (as a beneficiary, trustee, etc.) in implementing these tools. Also, you and your spouse likely share a lot of accounts, assets, or even an estate plan. Thus, when your spouse dies, it’s not just about settling their estate; it’s about making sure your own estate is taken care of too.
This post takes the estate management perspective, providing you with a comprehensive list of steps to take when a spouse dies. Here, you will learn all the crucial tasks necessary to properly manage, distribute, and administer your deceased spouse's estate and ensure that your estate is updated accordingly.
1. Obtain the Death Certificate
Obtaining a certified copy of the death certificate is one of the immediate steps you must take upon your spouse’s death. Your spouse’s death certificate is a critical document when settling their estate. You need it for a variety of tasks, such as closing accounts, claiming life insurance benefits, and updating legal records. Make sure to obtain multiple copies, typically 10-15, because most institutions require them. Contact the vital records offices of your county or city to obtain your certified copies. A copy costs around $20, depending on your state.
2. Notify Key Institutions
Aside from your family and friends, other people and entities also need to be informed of your spouse's passing. These include:
Social Security Administration (SSA)
Although most funeral services inform the SSA of deaths they arrange, you should still do it as a confirmation. Notifying the SSA is also critical because this will stop your spouse’s benefits from being released. If you received these benefits after your spouse’s passing, you will need to pay them back. Upon notifying the SSA, you may be entitled to receive a death benefit.
Employers and Pension Providers
Contact your spouse’s employer or pension provider to inform them of the death and begin the process of claiming any death benefits, pensions, or retirement accounts. If your spouse is a member of the military, contact the Department of Veterans Affairs to cancel payments or claim benefits. Similarly, if your spouse is a member of a labor union or a similar organization, notify them and inquire about death benefits.
Insurance Companies
Make a list of your spouse's insurance and contact them to file a claim for benefits. Check if your spouse has the following types of insurance:
Burial or funeral insurance - This will be useful to cover funeral costs and related expenses.
Term or whole life insurance - The funds from this can cover your spouse’s final expenses and provide for you and other indicated beneficiaries like your children.
Health insurance - This will pay for any medical bills and other similar payments left behind by your spouse.
Car, home, and other property insurance - You must notify the insurance providers to terminate the insurance and transfer or reapply the insurance in your name for jointly owned property.
Financial Institutions
Contact banks, credit unions, investment firms, etc., to notify them about the death. For your joint accounts with your spouse, you must initiate the transfer of the account holder's information to ensure that you can access your funds. You must apply for your spouse’s personal accounts to be closed so that the funds can be transferred to you or the beneficiaries. This applies to savings accounts, credit cards, and investment funds.
Other Government Agencies
Contact the state motor vehicles office to cancel your spouse’s license or ID and to transfer the vehicle ownership. Prevent voter fraud by contacting your local election office and canceling your spouse’s voter registration. Cancel social service benefits by contacting your state social services office, prevent identity theft by canceling the passport of your spouse, and contact the Internal Revenue Service (IRS) to file your spouse's final income tax returns.
3. Locate Key Documents
Gather and organize the necessary documents, which typically include:
Will or trust documents - These outline your spouse’s wishes in writing, guiding you on how you’ll manage and distribute their estate.
Marriage certificate - This document will be your proof of marriage, allowing you access to joint accounts and other shared assets. This will also help you exercise other spousal rights such as inheritance, survivor benefits, tax benefits, insurance, and death benefits.
Financial statements - These include bank accounts, investments, and retirement accounts. You’ll need these to manage the accounts for these assets.
Titles and deeds for property - These are necessary for transferring the property ownership or selling these properties if needed.
Insurance policies - These are needed to claim the policy benefits.
Loan and mortgage statements - These documents provide information on outstanding debts and other liabilities that you may need to settle to avoid foreclosure and similar problems.
Any legal agreements, such as prenuptial or postnuptial agreements - These agreements are essential for clarifying the distribution of assets, protecting individual interests, and ensuring that the terms agreed upon during the marriage are honored.
4. Consult with an Estate Planning Attorney
You need an ally during the process of settling your spouse’s estate. An estate planning and probate lawyer can help you:
Probate the Will
If your spouse left behind a will, it is sure to go through probate, a court-supervised legal process that validates the will and oversees its administration. An attorney can represent you through the process and minimize any stress or delays for you.
Administer a Trust
If your spouse created a trust, an estate planning lawyer can help you understand and administer the trust, ensuring that the assets are distributed according to your spouse’s wishes.
Claiming Benefits
After your spouse’s death, an estate planning attorney can help you navigate the process of claiming the benefits from insurance, retirement accounts, and social security. They can ensure that you receive the benefits that you are entitled to.
Transferring Deeds and Titles
Assets you jointly owned with your spouse need to be transferred to your name. An attorney can help you properly transfer any title or deed to reflect your sole ownership.
Update your Estate Plan
The death of your spouse will impact your own estate. An estate planning attorney can advise you on how to update your plan, including changing your beneficiaries, adjusting your will or trust, and reviewing other related legal documents.
5. Settle Debts and Close Accounts
When settling your spouse’s debts and unnecessary accounts, focus on the following:
Credit Card and Loans - You may need to arrange to pay off or transfer any outstanding debts.
Utility Accounts and Subscriptions - Close these accounts or transfer those you need to your name.
Make sure to check for any auto-payments or recurring subscriptions that need to be canceled.
6. Review Tax Implications
The death of your spouse will have significant tax implications you must consider, such as:
Estate Taxes - Federal and state tax laws will apply depending on the size of your spouse’s estate. Consult with a tax expert or estate planning lawyer for advice and assistance in filing the necessary paperwork.
Final Tax Returns - As mentioned, you will need to file a final income tax return for your spouse and possibly an estate tax return. Follow IRS procedures and comply with the requirements.
Surviving Spouse Tax Breaks - Inquire of any IRS tax breaks for surviving spouses, which can help you ease some of the tax burden.
7. Focus on Your Well-Being
Lastly, amidst the logistical, financial, and legal tasks, don’t forget to take the time to care for your well-being. Seek support by leaning on family, participating in grief counseling, or joining a support group. Practice self-care and take the time to process your emotions. Only after taking care of yourself will you have the strength to accomplish all the above tasks while experiencing the grief caused by the loss of your other half.
Along with the emotional and psychological impact of the loss of a spouse comes the overwhelming responsibility to manage their estate. The surviving spouse needs all the help they can get. By taking the essential steps outlined above and seeking professional estate law guidance, you can overcome these challenging times. When you feel that your spouse left you alone in this world, remember that you still have your family, friends, and trusted advisors to help you move forward. The Rilus Law team is here to provide the compassionate support you need in a difficult time. Please download our Free Loss of a Loved One Guide or give us a call with any questions. We’re here for you.