Important Information For Survivors
Contents: Updating
or Writing a Will
Whether you're a surviving spouse, a child, a family member or a friend, we offer this information as a practical reference, to share hope and insight - helping you to organize affairs and make personal changes.
Although it can't describe every possibility you may encounter, the purpose of this information is to identify options and general procedures, so you can use them to your benefit. As you work through the details you'll start to see progress. You'll see your life coming together, possibly with new meaning you hadn't realized ... and you'll discover there really is a promise in looking 'toward tomorrow.'
A Personal Experience When you lose someone you love, you will probably feel a variety of emotions. Sometimes the intensity of these emotions can be surprising, and they may subside after a period of time only to resurface again. This is very normal!
Grief is a process of making the fact of loss real. It takes time. People experience this process differently, but feelings of anger, loneliness and despair are a normal part of the process. The time it takes to work through grief is also different for everyone. No two people react or respond in exactly the same way.
Chronic grief, grief which continues for months and never seems to improve, can be a problem if it interferes significantly with your ability to function each day. You may wish to seek help from a clergyperson or mental health professional. During any period that seems stressful, it's helpful to remember that your feelings, no matter what they are, are worth feeling. They're neither good nor bad. Talking about your feelings as you experience them is helpful and important. Whether you talk with family, friends, special support groups or a counselor, share your feelings. As you open up you'll be able to identify your emotions ... and if they trouble you, you can start to deal with them, moving toward recovery. The period of recovery is also different for every person. It's your own period of adjustment, on your own terms. Be patient with yourself and take one step at a time.
It's normal for some days to be better than others. Birthdays, anniversaries and holidays may present an unexpected reminder, triggering a flood of emotion. You may think that you should be past having these feelings, but don't judge yourself too harshly. Special group seminars on these subjects may be available in your area. Organizations are also established to help with counseling. Your funeral director or clergyperson can help you locate them, as well as local support groups for bereaved persons.
Life Insurance
Since this is most often the largest source of specific benefits for spouses and children, you should locate all of the known policies. Don't discard any of them until you're sure they are no longer in force.
When redeeming a life insurance policy, a certified copy of the death certificate is usually required. Some companies also require the return of the policy. In this case, keep a photocopy of the page(s) summarizing the benefits of the policy for your files. You should also contact the deceased's former employer to see if there are survivors' benefits from a group insurance plan.
Social
Security family members of a deceased person:
• widow, widower, or surviving divorced spouse • dependent child • dependent grandchild • dependent parent
The monthly payments to eligible family members are equivalent to a specific percentage of the worker's benefit, and are usually calculated on the basis of the total amount of primary insurance that has accrued throughout the worker's life. The amount of the actual benefit may be reduced if the worker received benefits prior to attaining full retirement age.
• Your Social Security number, and that of your spouse (or the decedent) • Birth certificates - your own and those of dependent children • Marriage certificate • Copy of the death certificate
Certain qualifying restrictions may also apply, and it may take up to two months to start receiving regular payments. Full details, on eligibility are available by calling a local office of the Social Security Administration.
A lump sum may be paid to the estate of the deceased if that person contributed to the plan for at least the minimum qualifying period. For persons already receiving Canada Pension benefits, this sum would be approximately six times the amount of their existing monthly benefit.
Additional benefits for widows and allowances for dependent
children may also be available. Applications should be made to the local Canada
Pension office.
If the deceased was a discharged veteran, your funeral director probably helped with filing for funeral expense benefits from the U.S. Dept. of Veterans Affairs or the Canadian Dept. of Veterans Affairs. Other sources in Canada include the Dept. of National Defense and the Last Post Fund.
In the U.S., surviving spouses and children may also be eligible to apply for VA benefits. If the death was service-related, dependency and indemnity compensation may be available. If the death was not service- related, a pension is available for widows, widowers or dependent children. Additional survivors' benefits are available in certain cases. Complete information is available through the U.S. Dept. of Veterans Affairs. Ask for the booklet, 'Federal Benefits for Veterans and Dependents."
Pensions
You may be eligible to collect a monthly or a lump-sum benefit from a pension or retirement account in which your spouse was vested (guaranteed payment). Civil Service positions are included. Contact the former employer, or an office of the Civil Service Commission to see if this is the case.
If you're involved in taking care of the personal and financial affairs of the deceased, the first thing you'll want to do is locate all relevant documents. Taking time to do this first will make handling the details easier and less time-consuming.
If a Will, Letter of Instruction or an Estate Record was prepared, finding the papers you'll need will be fairly easy. If not, start with the person's checkbook, cancelled checks and related records. These will give you some leads to mortgages, loans, charge accounts, income and property taxes, investments, other assets and debts which will need to be closed or transferred.
While you're looking, check for receipts or records of regular special income such as rents, stock dividends, bonds or funds and social security benefits. It is also a good idea to check the mail addressed to the deceased for about a year, so that no assets or liabilities that need attention are overlooked.
In most states and provinces, the procedures for handling a small estate, and transferring jointly-owned assets to a surviving spouse are rather routine. They become more intricate if: 1) Several accounts or assets were owned solely by the deceased, 2) The estate is to be distributed to heirs, family members or friends, or 3) The value of the estate is quite large, especially with land, buildings or business holdings.
To handle these details you may be required to retain an attorney. Even if the law in your area doesn't require you to do this, you may wish to anyway. Avoiding confusion by complying with the right procedures at the right times will be worth the fee.
By definition, a Will is a document specifying a person's directions for the distribution of property after death. In recent years, the practice of preparing a Letter of Instruction to accompany the Will has become popular. This letter often lists funeral service preferences, the location of the Will and important papers, and names a personal representative (executor) to handle the estate. Some people, often those who have pre-arranged their funeral, use a personal estate record to list this vital information in a more complete form. If such a letter or record is known to exist, find it and read it promptly.
Probate Procedures
The purposes of probate are to determine the validity of a Will, provide for protection of children, ensure payment to legitimate creditors and distribute remaining assets to the rightful heirs. If no Will exists, the assets may be auctioned and proceeds go to the state.
The existence of a Will does not always mean that lengthy formal probate proceedings will be required. Depending on the size and nature of the estate, your state or province may have procedures which simplify the requirements and steps to be taken.
As a general rule, probatable assets include:
If the total value of the assets subject to probate exceeds the limits for the less formal procedures in your area, the court becomes directly involved in the process of settling and closing the estate. Formal probate proceedings are often lengthy and detailed, as is managing an estate of this size. The advice and services of an attorney who specializes in probate are recommended.
Taxes In handling the finances of the deceased you may encounter Federal Estate Tax, Inheritance Tax and final Personal Income Taxes.
If the estate is of substantial value, there may be Federal Estate Tax to be paid. Like personal income taxes, several opportunities for deductions exist. Funeral expenses, charitable gifts and the administrative costs of the estate, as well as mortgages and outstanding debts, are among legitimate deductions. Surviving spouses are entitled to an unlimited marital deduction on assets received, which is usually very helpful.
After deductions are applied, if the taxable value of the estate is still substantial, an attorney's help in filing the Federal Estate Tax return is recommended. There is a nine-month deadline for filing.
In most areas, each beneficiary of an estate is liable for an Inheritance Tax on the value of what they receive. Like the Federal Estate Tax, there are several exemptions and deductions available. Regulations vary, depending on your location.
If the deceased was employed or received any taxable income, final Personal Income Tax returns will need to be filed on or before April 15th of the following year. At that time, the filing status of a surviving spouse should also be changed. These returns may yield a refund of excess withholdings. If there is no surviving spouse, this refund should be identified and distributed to beneficiaries.
Jointly-owned accounts usually transfer directly to a surviving spouse. Some institutions may require a copy of the death certificate to complete their forms, but in most cases this kind of transfer is a matter of updating records. A co-owner of an account still controls its use.
When there is no surviving spouse, or when an estate's probate value is known to be substantial, some institutions may freeze any accounts or holdings until the proper inheritors are identified and claim them. Copies of the death certificate will be required to transfer these assets.
Safe deposit boxes are somewhat different. On the notification of a death, most banks will automatically 'seal" a safe deposit box so its contents can be evaluated for tax purposes. Co-renters of a box are usually allowed access as this evaluation is done, so that jointly-owned items may be claimed. Items owned solely by the deceased remain there until beneficiaries are identified.
Trust funds are most often arranged with the help of a bank officer and an attorney. These individuals should be contacted for information on the administration of such funds.
Contact the institution holding a mortgage on the home of the deceased, or holding other outstanding loans. Provisions may have been included, such as mortgage or credit insurance, which automatically pays off the balance on the death of the principal. If no such provision exists, a transfer of the remaining part of the obligation to a survivor or inheritor is necessary. A copy of the death certificate will be required.
In order to cancel or modify a charge account, credit cards in the name of the deceased should be returned to the institution or company which issued them, along with a memo noting the death. This will help guard against unauthorized use of the account. If a card was illegally used prior to such a notification, most companies hold other authorized users liable for only the first fifty dollars of illegal use.
Motor Vehicles
Procedures are established in most states and provinces for transferring the title and registration of any vehicle. This usually includes a fee. Whether jointly owned or not, probate is not usually required for the transfer of an automobile. Upon receiving a vehicle, an inheritor also assumes financial responsibility - including any loans, taxes and insurance.
Business Assets
If the deceased owned or had interest in a business, these holdings will likely require some attention. Many people holding business assets prepare a will with specific instructions for their distribution. Some companies also have Buy and Sell Agreements among stockholders, simplifying the transfer of ownership. If not, don't be pressured to "sell out" without legal or financial advice on the true value of the holdings. If you elect to retain ownership as a partner or shareholder, the assets must be officially transferred to your name.
Survivors or inheritors receiving business assets should also evaluate the effects on their personal income taxes. The assistance of an attorney or tax advisor is recommended.
Insurance
Health insurance is another consideration. If the deceased participated in a group medical plan, part or all of the benefits may be convertible to family members at similar cost. Check with the employer.
Medicare and Medicaid are the hospital and medical insurance programs of the U.S. Social Security Administration. Medicare is for anyone age 65 or older. It functions in two parts; Part 'A' covers a portion of the charges for hospital stays and some diagnostic, home nursing and psychiatric services - at not cost. Participants in Part "B" of Medicare pay a voluntary monthly premium for the coverage of surgery, physicians' services, and other related medical costs.
The Medicare program doesn't cover all charges. There are deductibles and co- payments involved. It also requires an application for benefits. Part "A' can be made retroactive for up to 12 months prior to the date of application. Part 'B" starts on the date you apply.
Medicaid provides health care for people of any age whose income is at or below poverty level. This program also provides some additional coverage for those over 65 whose Medicare benefits are depleted.
To extend any of these coverage's, you may wish to investigate supplemental health insurance, or consider joining a health maintenance organization (HMO). HMO's offer a variety of services, focusing mainly on preventive health care. Contact your insurance agent for an evaluation of supplemental health policies best suited for your needs.
It is important for a surviving spouse to have a will drafted, especially if one hasn't existed before. In the future, this will be valuable in preserving the estate and directing its distribution. If a will does exist, this is a good time to consider changes in values and beneficiaries if needed. In order for the will to remain valid through revisions, an attorney's direction is recommended.
Pre-Arranging Your Funeral Service
Establishing the funding at the same time allows you to arrange the specific kind of service you desire, at today's prices, and be assured of adequate funds whenever they're needed. The steps involved in pre-arranging and funding a funeral service are fairly simple. Call English Funeral Chapels & Crematory or your local Selected Independent Funeral Home for an appointment at your own home or at the funeral home.
At Home
For both widows and widowers, a major move or the sale of a home right after the death of a spouse may not be the best step to take. Take time to consider your general comfort, familiarity with your surroundings and equity built up in the property. Consider the alternatives of renting an apartment or buying a condominium carefully. If you choose to sell, have your property appraised by a licensed real estate broker.
After a death is publicized it is not uncommon for unscrupulous people to attempt mail fraud - sending collect packages and bills disguised as having been previously ordered by the deceased. Statements or invoices should be checked carefully. In this instance the law is clear: you may refuse delivery of suspicious items, and payment for unauthorized packages is not required.
For surviving spouses it is advisable to keep your present telephone listing the same, or to change it only to your initials and surname. Other changes may be a clue that you now live alone, resulting in annoying, calls and solutions.
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