When a person passes away, he or she usually leaves behind not only assets, but also valid debts and liabilities. At our law firm, we sometimes represent creditors trying to collect debts that survive the deaths of the deceased people who became liable for those debts during their lifetimes.
At our law firm, we provide estate planning advice and services to Colorado clients at all levels of wealth, but for those at upper tax brackets, it is important to evaluate if and how federal gift and estate taxes could impact choices to make lifetime gifts as well as estate planning choices to minimize tax liability.
Today we will talk about what a Colorado personal representative does to administer the estate he or she has been appointed to handle. Last week, we talked about the fiduciary duties of a personal representative, including duties of loyalty, care and impartiality toward the deceased, heirs and beneficiaries, the court, creditors, government authorities, interested parties, creditors and involved professionals.
For those getting a divorce, a beneficiary designation on a life insurance policy is not usually top of mind. And for that reason, states including Colorado, have passed laws that an ex-spouse beneficiary does not receive life insurance proceeds after a divorce unless there was an affirmative designation after the divorce.
With any Colorado estate that requires probate court review, a final accounting summarizes receipts and payments during the estate administration process and remaining assets to disburse to heirs. The Colorado Judicial Branch provides standard forms that can help with organization.
Giving strategies are as varied as the family. And while lifetime giving has tax advantages, it is often about more than tax planning.
Beneficiary designations on pay-on-death accounts – life insurance, 401(k) or Roth retirement funds and saving/checking accounts – are too often ignored.
Hard to believe as it is, the artist passed away two years ago in April 2016. In the meantime, his home at Paisley Park has been turned into a public museum. And his $100 to $300 million-dollar estate is still being fought over by a sibling and half-siblings.
A recent Colorado Court of Appeals illustrates what can go wrong following the death of a loved one. From determining whether what a parent did was a mistake or part of a plan to flawed attempts to avoid litigation, the case raises issues about pay-on-death designations, special needs trusts and conservatorship fiduciary responsibilities.
Regardless of what a collector claims on the phone, you are not legally responsible to pay a credit card bill in most cases. A collections agent may cite “moral obligation” to exploit your desire to do the right thing, but you cannot let a debt collector play on your emotions.