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Location: Chapel Hill, NC, formerly NoVA and Phila
9,779 posts, read 15,790,796 times
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My mother-in-law suffered a debilitating stroke over the winter and is in a nursing home. She likely doesn't have much time left. In the mean time, my husband has power of attorney over her finances. Is there anything he needs to do financially before she dies that would make sense tax-wise versus doing it after she dies?
This is what she has:
She owns a house worth about $100K. It is in her name and my husband's name, although not with survivorship. He will be selling this house. It can be sold now or later.
She has an annuity IRA worth about $85K
She has another annuity (not IRA) also worth about $85K
She has mutual funds worth $30K
She has CDs worth $60K
She has about $20K in her checking account which will pay for her funeral and other expenses. The checking account is joint with my husband.
These are all of her assets. My husband is an only child and is the beneficiary on anything that has a beneficiary.
We were just going to plug along and take care of things after she passes, but just want to make sure there isn't something that should be done beforehand either because of taxes or because there is less complicated paperwork.
We were just going to plug along and take care of things after she passes, but just want to make sure there isn't something that should be done beforehand either because of taxes or because there is less complicated paperwork.
If you have any tips, let me know. Thanks!
Yes. just plug along or consult an estate planning attorney. Just plug along and she passes. Probate fee$, stuff tied up in court for a year or more. The State tells the family who gets what and how much. Complicated and expensive!
OTOH see an attorney. For what my attorney wife charges ($1500 for your mom-in-law's modest estate) you will save $1000s-(five or six) and time (just 4 months for a distribution of assets) and your mom can have her wishes carried out as to who gets what and how much!
Location: Chapel Hill, NC, formerly NoVA and Phila
9,779 posts, read 15,790,796 times
Reputation: 10888
Yes, speaking to an attorney is probably a good idea. I don't really understand probate. She does have a will. She has no other blood relatives in the US other than my husband and our children. She has some nieces in Europe and that's it. So I'm sure my husband would get most everything unless her will specifies otherwise.
I know she can gift $14K without tax consequence while she's alive, but we're not immediately in need of the money so don't know if that's necessary.
Yes, speaking to an attorney is probably a good idea. I don't really understand probate. She does have a will.
Probate is the process by which the estate is distributed. It takes an attorney working with the Court to distribute the assets of the estate according to state law. By State law there are fixed fees the attorney is allowed to charge to handle the estate. Varies by state. Usually 4% for the first $200,000 or so.
The will is fine as far as who gets what, but it does not avoid the probate process and fees.
Visiting an attorney will save the estate time and money-done while the client is competent and still alive.
Location: Chapel Hill, NC, formerly NoVA and Phila
9,779 posts, read 15,790,796 times
Reputation: 10888
Quote:
Originally Posted by Mr5150
Probate is the process by which the estate is distributed. It takes an attorney working with the Court to distribute the assets of the estate according to state law. By State law there are fixed fees the attorney is allowed to charge to handle the estate. Varies by state. Usually 4% for the first $200,000 or so.
The will is fine as far as who gets what, but it does not avoid the probate process and fees.
Visiting an attorney will save the estate time and money-done while the client is competent and still alive.
Thanks for the explanation. Unfortunately, my MIL is not competent at this stage. My husband has power of attorney. I did just read up on probate in NC, and it looks like assets that she has in both her name and my husband's name do not need to go through probate nor do retirement assets with a beneficiary. So that includes the house, her checking account, and her annuity, I believe. I will have him check into her other assets. It looks like probate in NC is pretty straightforward.
I don't know about NC but in MD you don't need a lawyer to open and estate and go through probate. I just went through it with my husband's estate and it's very straightforward and much easier than I'd anticipated.
Location: Chapel Hill, NC, formerly NoVA and Phila
9,779 posts, read 15,790,796 times
Reputation: 10888
Quote:
Originally Posted by rachelacey
I don't know about NC but in MD you don't need a lawyer to open and estate and go through probate. I just went through it with my husband's estate and it's very straightforward and much easier than I'd anticipated.
That's good to hear! After reading about probate in NC last night, it doesn't sound like it will be too bad here either. There are "fill in the blank" forms to do it. Most of the accounts already have my husband's name on them or he is the beneficiary, and it says those accounts don't have to go through probate. Thanks for your comment.
and if you don't need the money, then what does it matter even if it takes 4 months to distribute?
My suggestion would get husband named in all instruments if possible in her mental competency state, prepay the funeral of her wishes, and enjoy her while you have her. That is what my ex husband did and it was simple enough and he was the only child.
But if her estate were more complicated or your lives were so full you didn't have the time or energy to handle probate, then getting a lawyer make more sense.
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