Financial Steps to Take After Losing a Loved One
By Synergy Capital Solutions on November 15, 2024
Losing a loved one is a deeply emotional experience that can also bring significant financial and legal challenges. Every situation is unique and Your Synergy Team is here to help.
“What do I need to do now?” That is a question you might ask yourself after the death of a loved one—and for good reason. There are often a lot of issues to consider and steps to take. The following list may help you and/or others during this difficult and stressful time. Not all of the points will apply in all cases, but many of them may.
First Weeks
The first thing we recommend doing is gathering key documents:
Death certificate
Medical and insurance policies
Financial account information
Wills, trusts, estate documents
Employer benefit plans
Any outstanding loan documentation
Property deeds, vehicle titles, etc.
Consider working with an attorney to guide you through the following process. The Will along with a copy of the death certificate will likely need to be submitted to:
-Banking institutions
-Brokerages
-Credit unions
-Credit card companies
-Social Security administration
-Medicare (if needed)
-Insurance companies
-Probate court – you will probably want an attorney’s guidance on this.
Be prepared for restrictions to be placed on your loved one’s financial accounts once you have alerted the various institutions of their passing. Trades and money movements cannot be made within, or out of a deceased person’s checking, savings, investment or retirement accounts.
First Months
Determine how to process the sale or transfer of assets like the home, cars and personal property to a 3rd party or family members specified in the estate plan. A lot of this may be outlined in the Will or Trust and is typically the responsibility of the successor Trustee, if indicated in the estate plan.
Ensure financial institutions are completing a step-up in cost basis to the date of death to help avoid a costly tax liability hitting the estate. Work with your attorney and tax advisor to determine if all or a portion of each account should be stepped up.
Contact one of the three credit reporting agencies (Equifax, Experian or TransUnion) to notify them of the death. This
will get the account flagged at all three so that no credit will be issued in your loved one’s name.
Forward any mail to an address that will be checked.
Cancel any memberships or subscriptions like gyms, cell phones, streaming services, etc.
Ensure you review any retirement accounts to evaluate if any Required Minimum Distributions (RMDs) must be withdrawn. It is important to know that if your loved one was taking RMDs, it must be completed before December 31st .
First Year
A final tax return must be filed with the IRS by April 15th of the year following the death unless you file for an extension.
Beyond
Once everything has settled, file an estate closing letter. Be sure to update all your plans as well.
Your family, financial advisor, accountant, attorney and other advisors are here to help. While no one can perfectly understand what you’re going through, your advisors use their experience of supporting others to alleviate stress and uncertainty by providing you with both their skill and compassion.
By using this checklist and professional advice, you can help safeguard your family’s financial future and know your loved one’s wishes are honored and legacy continues.
Please reach out to us if you or anyone you know needs help during or preceding this difficult period.
