Not my debt, not my problem.
April 6, 2015 10:01 PM Subscribe
So, you all have been very helpful when it came to the Life Insurance question. Good news! I found a policy! Bad news! It's so small that it barely covers the cremation expenses, of which I paid out of pocket. I've now tallied up his assets and his debts, and the debts far outweigh the assets. Like, there'll be enough to recoup my costs for the cremation, but really not a lot else.
Now, I know that I'm not liable for his debts, but how do I communicate to the creditors that the Estate is Insolvent, and consequently they're not getting paid?
There was no will, and I'm the Executor, as appointed by the State of WI. I'm taking all of his assets and keeping them in a separate account, and logging all the transactions. The numbers are so small; we're talking $5,000 in assets and $7,500 in debts (roughly). Dad and I don't have any money comingled, and there's nothing of his that I can sell to help defray these costs.
If this affects things, I like in WA and he lived in WI. The estate is so small that I didn't go to Probate, instead I got an Affidavit which listed his assets (that I knew of at the time), and I made a sworn statement that these are to be used to pay off his debts first. However, I didn't get a Letter of Testamentary before I left WI, and consequently his money is in a separate checking account under my name at a Credit Union. No money has gone out yet; I just needed a place to put it. I'm also the only next of kin, so there's no one to share the load with.
When I talk to friends and relatives, they say "You're not responsible!" I know that, and there is no way that I'm going to pay off his debts. But, do I need to prove that there's no money in the account to them? If so, how? If this is a 'Get thee to a Lawyer!' situation, I have one I can contact. I'm kind of hoping that the Hive Mind has some insight into this situation. Especially if I'm doing something obviously right or wrong.
There was no will, and I'm the Executor, as appointed by the State of WI. I'm taking all of his assets and keeping them in a separate account, and logging all the transactions. The numbers are so small; we're talking $5,000 in assets and $7,500 in debts (roughly). Dad and I don't have any money comingled, and there's nothing of his that I can sell to help defray these costs.
If this affects things, I like in WA and he lived in WI. The estate is so small that I didn't go to Probate, instead I got an Affidavit which listed his assets (that I knew of at the time), and I made a sworn statement that these are to be used to pay off his debts first. However, I didn't get a Letter of Testamentary before I left WI, and consequently his money is in a separate checking account under my name at a Credit Union. No money has gone out yet; I just needed a place to put it. I'm also the only next of kin, so there's no one to share the load with.
When I talk to friends and relatives, they say "You're not responsible!" I know that, and there is no way that I'm going to pay off his debts. But, do I need to prove that there's no money in the account to them? If so, how? If this is a 'Get thee to a Lawyer!' situation, I have one I can contact. I'm kind of hoping that the Hive Mind has some insight into this situation. Especially if I'm doing something obviously right or wrong.
This is the sort of thing that a brief consultation with an experienced estate attorney would solve. I am the executor of my dad's estate (different circumstances, different state, there was a will, etc. etc.) and though I have handled some things myself like paying bills and maintaining the property, there are other things that I had to run past an attorney. Note: you really should get the Letters Testamentary because if there's anything you need to do like get a death benefit or get a copy of a 1099 you will need to show it along with a certified copy of the death certificate.
posted by bedhead at 9:16 AM on April 7, 2015
posted by bedhead at 9:16 AM on April 7, 2015
Informal administration may or may not require the involvement of a probate attorney, and you need to check with your county's Register in Probate to determine if that is the case.
Generally speaking, resolving the insolvency status involves notifying each creditor that the deceased has passed and that there is a deadline for claims against the estate. The probate court and your attorney will then help you with the next steps. Being nearly insolvent does not necessarily mean that creditors won't get paid, but it may mean that there's a pecking order or that they'll only get a portion of what they're owed. It is important that you get proper guidance on how to proceed.
posted by jgreco at 12:39 PM on April 7, 2015 [1 favorite]
Generally speaking, resolving the insolvency status involves notifying each creditor that the deceased has passed and that there is a deadline for claims against the estate. The probate court and your attorney will then help you with the next steps. Being nearly insolvent does not necessarily mean that creditors won't get paid, but it may mean that there's a pecking order or that they'll only get a portion of what they're owed. It is important that you get proper guidance on how to proceed.
posted by jgreco at 12:39 PM on April 7, 2015 [1 favorite]
Response by poster: These two answers tell me that yes, I really do need an attorney here. Luckily, I got a reference for one in the Milwaukee area. Hopefully, they'll help, because I'm way out of my league here.
posted by spinifex23 at 12:49 PM on April 7, 2015
posted by spinifex23 at 12:49 PM on April 7, 2015
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posted by Little Dawn at 11:09 PM on April 6, 2015 [2 favorites]