Volume 6 Issue 3

May/June 2002

© by Newland & Associates

Recently, a client of mine passed away, and her relatives immediately called me and asked, "What do we need to do?"  Their concerns and questions made me realize that a practical guideline to refer to during such a stressful time would be very useful. A more detailed list is available by CLICKING HERE.

Woody Allen once said that he wasn't afraid of death; he just didn't want to be there when it happened.  Perhaps, someday, you, like my client's relatives, will be the one who is "there" when a friend or relative dies.  This newsletter discusses the suggested basic administrative steps that should be taken.

Immediate Steps

If death occurs in a medical facility, a physician will prepare a death certificate.  If death occurs at home, you will need to contact a Coroner.  You will need copies of the death certificate for the many tasks involved in resolving the Decedent's estate.

Contact friends and relatives by using a "branching" system so others can help you make calls.  Make funeral and burial arrangements.  If any instructions were left by the Decedent, his or her wishes should be followed, if possible. 

The Estate

You should look for any life insurance policies, bank statements, and investment statements, as well as executed estate planning documents such as a Will and Trust, in order to begin probate.  Probate is a judicially supervised system for gathering and distributing the assets of a Decedent.  If the Estate is under $15,000 in total assets, it may be possible to avoid or reduce probate. 

If there is no Will, the Decedent is considered to have died intestate and the assets of the Decedent will be distributed according to state law.  Stated differently, if you die without a Will, the state, in essence, writes one for you called "Intestate Distribution."  Roommates and playmates are not included in the intestate rules.

Personal Representative

A Personal Representative (PR), sometimes referred to as the Executor, will be designated in the Will or appointed by a Court.  It is the job of the PR to gather the Decedent's assets and distribute them according to the Will and state law, while satisfying officials that all of the assets received and distributed have been properly accounted for.  The PR can be an individual or combination of individuals and/or trust companies acting in concert. 

The PR should take the Will to a judicial official and have it admitted for probate. The PR will receive Letters Testamentary which are the badge of authority for the PR to act as the representative of the Decedent.  

Assets placed in certain types of Trusts are not subject to probate.  The role of such Trusts is addressed on our Web site.  If the Decedent had a Trust, the PR may want to consult with the attorney who drafted it.

One of the first actions the PR should take is to open a new bank account so that any income or receipts of the Estate can be recorded.  The PR should never commingle personal assets with those of the Decedent.

The PR should NOT hastily distribute assets or pay debts.  There are many decisions to be made and acting on them too quickly could come back to haunt the PR.

In Virginia, the first inventory of the assets of the Decedent is due four months after the Will is accepted for probate, and the First Accounting is due sixteen months from the date the Will is accepted.  The PR should take time to consider the choices and consult with representatives like attorneys, accountants and government agencies.

Dealing with Government Agencies

If the Decedent was receiving government benefits, like Social Security, the PR must inform the agency and, in some cases, return payments for the month of death.  The PR is also responsible for seeing that the taxes of the Decedent are paid.  In extreme cases, if the PR does not provide for tax payments, the PR can become personally liable for the debts of the Decedent.  The old saying, "the King is dead or dying; the King shall be first paid," has been incorporated into Federal law.

For a more detailed list of actions that need to be taken CLICK HERE, or you may call us to request a copy.

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Published by the law firm of Newland & Associates, P.L.C. For a full range of business law and tax-related services, call us at (703) 330-0000. You may also e-mail us at , or visit our web site at http://www.tax-business.com.

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