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What to Do When a Loved One Dies

The following actions are recommended upon the death of the Settlor, when he or she is an individual or the second of a married couple to die.  You may be the child or grandchild of the deceased Settlor, or a distant relative, friend or independent third-party stepping in as the Successor Trustee.  This is not intended as an exhaustive or detailed list of all the actions, which should be taken by you as Trustee.  Rather, it is intended to give you a brief, general checklist, which will help you immediately step in and handle those items that demand your attention first.

 

  1. Contact Proper Authorities. If the Settlor was an organ donor, you’ll need to act quickly. If you are not sure, check his or her driver’s license or the Final Instructions in the Settlor’s estate planning binder for instructions. If death occurs under hospice care, they will notify the proper authorities and help you make arrangements for transport of the remains.

  2. Take Care of Yourself First. If you are a close family member, and the Settlor’s death has come suddenly, the most important thing is to take care of yourself first.  Shock and trauma can take unexpected forms.  Most actions that will need to be taken do not have to be done immediately and, if you act too quickly out of worry or anxiety, you may do the wrong things and make bad decisions.  The first important deadline generally does not occur until nine (9) months after the date of death.  You should contact a family member or friend who can spend time with you, either by phone or in person, during the next few hours or days, until such time as you are emotionally stable and can pursue the other items on this checklist.  Avoid entering contracts for anything while you are still in a highly emotional state, and avoid spending or lending large sums of money.  Do NOT make any financial decisions that involve moving title to assets, selling or reinvesting accounts until you consult with an attorney and/or CPA, as such actions may have adverse tax consequences and violate the terms of the Trust.

  3. Contact by telephone or otherwise notify the immediately family, close friends, business colleagues and the Settlor’s employer (even if the Settlor had already retired, as there may be some benefits available).

  4. Arrange for the care of members of the immediate family who may need continuing personal attention, including appropriate in-home living assistance or childcare.  Don’t forget the Settlor’s pets.

  5. Notify a funeral director and clergy, and make an appointment to discuss funeral arrangements.  Consult the Settlor’s Estate Planning binder for the names and phone numbers of any parties the Settlor may have selected and any special requests.  Determine if all, or part of, the Settlor’s funeral costs have been prepaid or if the Settlor had a prepaid plot or burial insurance. Veterans, service members, and their dependents can be buried in a national cemetery for free.     If buried elsewhere, veterans who at the time of death were entitled to receive VA disability payments can receive an allowance toward burial and funeral expenses.  This allowance may be greater if the death was related to military service or if it occurred in a VA hospital.  Other benefits may include a ceremonial American flag, a headstone, and a Presidential memorial certificate.

  6. Submit an obituary to the decedent’s local paper(s).  Make sure you include a charitable organization for donations if that is preferred over flowers. Do not include the decedent’s address in the obituary or in an on-line memorial.

  7. Keep track of all donations, flowers, and cards received.  Purchase sympathy acknowledgement cards, or use those sometimes supplied by the funeral home, and send out acknowledgement cards according to your list.

  8. Request several copies of Settlor’s death certificate, which you’ll need for his or her employer, life insurance companies and for your attorney for legal procedures.  Additionally, you will need one (1) original death certificate for each parcel of real property and Deed of Trust owned by the Settlor.    It’s easier to have the funeral director or mortuary obtain these for you, than for you to obtain them later on your own, so simply ask the funeral director or mortuary for more than you think you will need.

  9. Locate the Settlor’s important papers, including the Living Trust and other estate planning documents.  Also, inventory the safe deposit box, if any.  Gather as many of the Settlor’s papers as possible, which could include statements of various accounts and assets, tax returns, deeds, insurance and annuity policies, etc.  Realize that this information gathering process may not be completed all at once and may take several weeks.

  10. Locate the Settlor’s Digital Assets and Accounts.  Digital Assets include on-line banking accounts, digital music library, digital photo library, files the Settlor created on his or her computer, accounting files such as Quicken or QuickBooks, scanned documents stored on the Settlor’s computer, Internet bank accounts, PayPal accounts, U.S. Treasury accounts, email accounts, like Gmail, Hotmail, or yahoo. You should review the Living Trust Document for authority to access and transact business in these accounts. However this is a new area of the law an if the Settlor did not update his or her estate planning documents, you may not have the authority you need. You will need to locate passwords to access these accounts among the Settlor’s important papers. Do not delete or close any digital accounts in the months immediately following the Settlor’s death. Delay notifying service providers of the Settlor’s death until you get appropriate legal and technical advice.    The fiduciary should do the following for digital assets:

    1.    Make an immediate inventory of all possible digital property.

    2.    Make physical and virtual access to the client's smart phone, I-pad, laptop and all other digital equipment, and secure the same.  This is critical.   If you need assistance with this task, please contact your attorney for advice.

  11. Discuss with attorney making timely notice to third party e-mail providers to preserve information contained in the email account.    If access to email is obtained by fiduciary, all emails should be downloaded to a file on the computer or disk drive.  Additionally, all contacts should be downloaded and saved for future reference.  This should be done prior to notifying the email provider.  

  12.        

a.         What if the client maintained an e-mail account through an employer e-mail system?   The fiduciary should access that account, and save emails not related to the employer's business.  Alternatively, the fiduciary should contact the employer and request that all personal emails of decedent that are contained in the business email system be either copied and given to the fiduciary or forwarded to the fiduciary's email.

b.         Many providers of free e-mail accounts will delete the decedent's account and its contents within a few months following notice of his or her death, so it is important that the fiduciary secure the contents of the email account prior to deletion by the provider.

4.         Make a quick inventory of online purchasing accounts and terminate them.

5.         Obtain access or control of web pages, blogs, social networking accounts, etc., in order to prevent identity theft, as well as preserve and transfer sentimental information for the family.   Download and save content onto a hard drive.

6.         Quickly determining the value, if any, of the decedent's digital property.

a.         This must be reported accurately on probate inventory, probate and/or trust accountings, and accountings required of an agent operating under a durable power of attorney.

b.         If the client has a taxable estate for federal and/or state estate tax purposes, the applicable value must be reported accurately on the federal and/or state estate tax return.

c.         Examples of potentially valuable digital property:

(1)        Intellectual property created by the client.

(2)        Advertising revenue stream from web pages and/or blogs.

(3)        Domain names.

(4)        Virtual currency.

(5)        Virtual real estate,

(6)        Unused credit card or travel points.

(7)        Refunds from online purchasing accounts.

(8)       Contents of e-mails and social networking accounts of certain public figures may have value.

  1. Change Address.  If you do not reside with the Settlor, change the Settlor’s mailing address with the local postmaster so that you can receive his or her mail.  You will need to complete a Change of Address Form and submit it to the U.S. Postal Service.  It may be done online through www.usps.com.  Proof of your authority to change the mailing address is typically not required.  This address change will be valid for only a limited number of months, so as mail comes in, you should notify any senders that future correspondence should be mailed directly to your address.

 

  1. Seek Legal Assistance. At the earlier of the date you begin to locate the Settlor’s important papers (as set forth above), contact our office to review the Settlor’s estate planning documents, discuss any possible state and federal death taxes due, go over any disclaimer (which must be made within 9 months of death) or other possible tax planning, determine if a Court Probate will be required for any assets not in the Trust name. We are available to assist you with some of the remaining items on this checklist. 

 

  1. Take the legal steps necessary for you to assume the position of Trustee.  If you were already serving as a Co-Trustee with the Settlor, you may be able to act as a sole Trustee/owner on certain accounts without requiring further legal documents.  However, it is still advisable that you pursue the following steps in order to take over other matters as sole Trustee.  If you are the first Successor Trustee named in the Trust, the process of properly installing you as acting Trustee usually simply involves obtaining a “Trust Certification”.  This is a document prepared by our office that verifies your authority to act as Trustee under the terms of the Trust and has attached a copy of the Trust and death certificate; that way, you will be able to transact business more quickly and smoothly with third parties, such as banks, mutual fund companies, real estate escrows, etc.  If you are not the first Successor Trustee named in the Trust, the process may be more complicated and involve the resignation or removal of a prior Trustee, or that Trustee’s death certificate, before you can obtain the Trust Certification.  Sometimes, a prior Trustee, the beneficiaries or a special party to the Trust (such as a “Special Co-Trustee” or “Trust Protector”) may have the authority to appoint and install you as Trustee and this may need to be done before you can obtain the Trust Certification.  If all of these options fail to install you as the new Trustee, you may need to file a petition with the Probate Court.  Regardless of the procedure used, you will likely need a Trust Certification when dealing with third parties.

 

  1. Trustee’s Notice. Once you have been installed as Trustee, you should notify the next Successor Trustee as well as the beneficiaries of the Trust.  The people you will be required by law to notify and how you must notify them will be determined both by the Living Trust document and state law.  We can prepare these legal notices for you.

 

  1. Establish immediate control over the assets in the Settlor’s home.  You may need to place valuables in safe, locked places and may even need to change the door locks in order to prevent “beneficiary raids”.  You may also want to write down a simple inventory (not necessarily in complete detail), just in case beneficiaries start to “borrow” items.  In most cases, it is beneficial to take a photographic inventory of the contents of the home.

 

  1. Terminate any credit cards in the Settlor’s name.  Let the credit card companies (as well as mortgage companies, utilities and other known creditors) know about the Settlor’s death and when they can expect payment; they usually will give you a “grace period” and agree to waive any late charges.  You may also want to ask your attorney whether a formal notice to creditors should be published or mailed before paying any creditors.

 

  1. Notify the Settlor’s financial counselor and accountant or tax preparer, or use your own or obtain a new one to assist you as Trustee.  Decisions may need to be made soon regarding sales and/or repositioning of financial assets, and tax planning, and estimated tax payments and tax returns may become due.  A new taxpayer identification number will need to be obtained for the Trust.  We can refer you to an experienced trust administration CPA, and either the CPA or our office will obtain the new tax id number for you.

 

  1. Telephone the Settlor’s employee benefits office (whether or not he or she was retired) with the following information: name, Social Security number, and your name and address.  The company will also likely require you to send in a death certificate so it can then begin to immediately research and process any benefits to which the Settlor and his or her beneficiaries may be entitled.

 

  1. Notify the local Social Security office of the death.  Report the death by calling toll free, 1-800-772-1213 between 7 a.m. to 7 p.m., Monday through Friday. You will need to have the Settlor’s Social Security number when you call.  

 

  1. Notify the government agencies, which provided any federal or state benefits to the Settlor, such as Supplemental Security Income (“SSI”), state disability income (“SDI”), Medicare and Medicaid (known in California as “Medi-Cal”). If the Settlor was receiving Medi-Cal at his or her death, you should not supply any financial information to the Department of Health Care Services without first contacting our office.  With respect to the other government agencies, contact the local program office and provide the same information as to the Settlor’s employee benefits office above.  You may be asked to return the last payment and/or to reimburse the benefits previously paid; if so, please let us know and we will work with you on this matter. If the Settlor was ever in the service, he or she may have available certain benefits through the Veteran’s Administration which you should check into.  We can assist you here, too.  We will prepare and send the required notices to the State of California Department of Health Care Services and the Franchise Tax Board.

 

  1. Notify appropriate accident and/or life insurance companies.  Give the same information as with the Settlor’s employee benefits office above and ask what further information is needed to process your claim.  It may be important to make insurance claims as soon as possible, so you can get immediate cash to pay various expenses.  If the Settlor’s death is a result of an accident where a third-party was involved, such as an auto accident, you may wish to consult with an attorney about possibly pursuing a legal claim on the Settlor’s behalf.

 

  1. Actively take over management of Trust property.  As Trustee, it is your duty to manage the affairs of the Trust to the same degree as would a reasonable, prudent person.  This duty includes placing cash assets in interest-bearing accounts, refraining from speculative investments, paying bills in a timely fashion and maintaining proper records.  You are permitted to delegate some of these duties to responsible professionals and pay their reasonable fees from the Trust.   We will advise you on this.

 

  1. You should be sure that all liability, fire, homeowner’s and personal property insurance policies are (and continue to be) in force and effect and have been “endorsed” to the Trust, naming you as Successor Trustee.  Should there be no such insurance coverage on real and personal property, you should consult with an appropriate insurance agent to review your needs and obtain adequate coverage.  (It’s probably a good idea to have an insurance agent review all the ones already in place too, to be sure they are adequate based on the current market values of assets.)

 

  1. Do NOT withdraw or rollover any annuities, corporate retirement plan benefits and IRAs without first seeking our advice.  Premature withdrawal of these assets, or even just moving them to another place or re-titling them, may cause undue immediate income tax consequences.  Note: there may have been a required withdrawal of a portion of these in the year of death, so again you should consult with the Settlor's financial advisor whether the required withdrawal has been made for the current year.

 

  1. Consult with our office at the earliest possible time, to help you establish a recordkeeping system, as we will not only need organized information for tax purposes, but you will in the future be required to provide an accurate accounting to the beneficiaries.

 

  1. Refrain from making loans, gifts or distributions to or for the benefit of anyone, without first going over the Living Trust document with us and determining the extent to which such loans, gifts or distributions are permitted and are advisable.  In some cases, the Trust document may require distributions of income or assets to be made to beneficiaries shortly after the Settlor’s death.

 

  1. Check with our office as to the advisability of your executing a “HIPAA Authorization” and providing it to the next Successor Trustee, in the event you are unable to act at some time in the future.

 

  1. Obtain appraisals of the value of the Trust assets as of the date of death.  (You may also have to value assets outside of the Trust in which the Settlor may have had an interest, such as those held in the Settlor’s name alone or jointly with others).  Qualified appraisers should do these valuations wherever possible, particularly with respect to any real estate.  Our office may assist you with choosing appropriate appraisers.  A financial advisor may be able to assist you with the valuation of any stocks, bonds, mutual funds, limited partnerships and any other investments traded on markets.  You may or may not need an appraisal of the Settlor’s personal property around the house, antiques and jewelry (you should make this decision with our assistance).  All these valuations will determine whether or not an estate tax return is due (which may be the case if the estate exceeds a certain size, even though there may be no federal estate taxes due).  These valuations will also be necessary for purposes of making distributions to the beneficiaries (or to new “sub-trusts” for them, which spring out of the Trust, and will hold their inheritance).  Finally, even if no estate tax return is due, these valuations will be important for future capital gains/income taxes of the beneficiaries.  Note: If the Settlor of the Trust owned assets in another state, a state inheritance or estate tax return may also be due there and, in rare cases, there may even be some taxes to be paid to that other state. 

 

The role of Successor Trustee is unfamiliar to most people and families, but it is very important and should not be undertaken lightly.  There is considerable work involved and major decisions to be made.  You have various duties, including the duty to treat all beneficiaries fairly, the duty to keep records and the duty to provide information to beneficiaries, to name a few. California law and the terms of the trust will govern your actions as Trustee. Our office is available to guide you through the trust administration process and reduce some of the stress that comes with the job. 

 

CALL OUR OFFICE TODAY FOR AN APPOINTMENT TO REVIEW TRUST ADMINISTRATION.   (760) 754-2381

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