Legal Considerations Your Client Should Keep in Mind
- After your client’s loved one has passed away, anyone authorized by a power of attorney to act on the now deceased person’s behalf is no longer valid. Therefore, for example, if a family member was in charge of paying the deceased person’s bills as an agent under a financial power of attorney, that person should stop paying those bills after the individual has died.
- If your client’s family member made arrangements for his or her funeral in advance, the deceased person’s written instructions may be legally binding under state law, and thus, the survivors may be obligated to comply with them. It is also possible that the client’s family member prepurchased their funeral arrangements through a local funeral home.
- If any of your client’s deceased loved one’s property or money was did not pass automatically to an individual by designation, that money or property must be handled through the probate process. That is, the money or property cannot be distributed to anyone without involvement by the probate court.
- If there is any possibility that your client or any other family member may want to disclaim, i.e., refuse to accept, any money or property they will inherit, it is important not to take any action that would be considered an acceptance of the inheritance. For example, if your client is one of the beneficiaries of the deceased loved one’s life insurance, but would like his or her share to go to the next beneficiary in line, your client should not complete any paperwork and reject any checks involving the life insurance policy. There may be tax consequences if they accept the money and then choose to give it to a different beneficiary.
- Your client and other family members should not prematurely distribute any of the deceased individual’s property or funds. The executor of the will or trustee of a trust are the only individuals allowed to distribute the deceased individual’s money or property and must pay all debts and taxes before transferring any funds or property to the beneficiaries.
Checklist of Initial Responsibilities Before Probate
- Make burial arrangements. If some time is likely to pass before burial, for example, if there will be a delay prior to a special ceremony and burial in a veteran’s cemetery, your client should make arrangements with a funeral home to store the deceased loved one’s remains until the service.
- Obtain ten original certified death certificates. After someone passes away, their death should be registered with the local or state vital records office, which can then issue official death certificates. A state-licensed funeral director or coroner typically prepares and files the death certificate with the state. A death certificate is often required to claim life insurance benefits, close bank accounts, transfer titles, and take care of other matters connected to the estate.
- Ascertain the immediate needs of beneficiaries and expenses that must soon be paid. Your client should determine which of his or her loved one’s accounts contains cash that can be accessed for the beneficiaries’ needs and other expenses. The last thing you want is for an item to be repossessed or the electricity turned off due to non-payment.
- Arrange care for animals. If your client’s loved one had pets or other animals, care should immediately be arranged for them. The will or trust may name the person your client’s family member has chosen to care for them, but if there was no will or trust, your client may need to arrange for someone to look after the animals until a caretaker can be determined.
- Inspect the loved one’s home to make sure it is secure. If your client’s family member owned a home, your client should walk around the home to make sure any points of entry are locked and that there are no maintenance issues that need to be addressed. The police department should be notified that the home will be vacant so police can patrol the area more frequently.
- Secure vehicles. Any cars your client’s family member owned should be locked. No one should drive the car, and the odometer should be checked to determine the mileage at the time your client’s loved one passed away. If the car is parked on the street or in a driveway, your client should notify the police to keep a closer eye on it. Insurance on the car should be maintained.
- Arrange for the home and yard to be maintained. Your client should continue lawn care and general home maintenance to ensure that the house does not become an eyesore and a target for thieves.
- Leave the heat or air conditioning on. To prevent any problems that may arise as a result of very high or very low temperatures, it is important to continue to heat and cool the home. In addition, if the home is vacant during cold winter months, a faucet should be turned on or cabinet doors opened to prevent pipes from freezing and bursting.
- If required, alert local officials of the vacant home. In some areas, a higher tax rate is applied to vacant homes, so in those places it is important to notify the city if the home is vacant and part of an administration.
- Cancel subscriptions and monthly service agreements. If your client’s loved one was receiving a newspaper, magazine, or other regular subscription or monthly service, it is important to cancel them, and if applicable, request a refund.
- Locate insurance policies. Your client should find all his or her loved one’s insurance policies. The homeowner’s insurance company should be contacted to confirm that there is coverage for fire, flood, and/or other needed items as part of the homeowner’s insurance policy. In addition, your client should locate the deceased family member’s life insurance policies, which may have been issued by alumni associations, travel clubs, credit card companies, trade associations, etc.
- Gather personal records. Your client should locate all bank statements, checkbooks, canceled checks, and at least the past three years of income tax returns.
- Determine if anyone owed money to the deceased loved one. While gathering the needed personal records, check to see if there are any documents reflecting debts owed to the deceased individual. Your client should contact those individuals to collect the amounts owed.