After the death of a loved one, the last thing any surviving spouse or surviving children want to think about is paying leftover debts of the deceased. The sad truth? When you die, your loved ones won’t be able to shed their final tears before the “accounts receivables” begin lining up to collect payments.
This list may not be as small as you think. And if there are no if there is no after-death devices in place, such as a will or trust, this list can grow substantially larger. Besides funeral homes and gravesites looking to vampire suck any financial resources available, the IRS will also come knocking, looking to collect on “their” assets. (lookup: IRS wikipedia)
Yes, THEIR assets. What does “The IRS” spell? Take a closer look…. THEIRS! Is that coincidence or brilliance?? From the IRS’s point of view, because you walked this earth, made money, and owned things, it’s time to PAY UP when you die. I think it’s absolutely brilliant. In a scary sort of way.. You only have to look back over history (lookup: Middle English King/serfs).
Everything you thought you owned outright can/will be subject to probate upon death, especially if there is no spouse and no beneficiaries designated. According to law, the dead person’s assets (estate) must pay off ALL debts and taxes before being transferred to heirs. For this and other reasons, families are beginning to turn to life insurance as a financial buffer against the stresses of post-life liabilities.
Common question: What if I have a will? Common answer: It’s not enough.
Your family will be speaking with the old grouch, Ms. Probate.
Probate is administering of a dead person’s will in court, or proving who gets what for a deceased person with/without a will. As a heads up, estate taxes are not the area that gives us the most headaches. It’s the probate process. BOOM!