Mom just died

My mom just passed and there is no will. I know I need to go to probate court and file for administrator of the estate. She doesn't have much but she does have lots of medical and credit card  bills. Don't know if I should handle this on my own or contact a lawyer. She's not married and it's just me and my younger sister. She only as $1700 in the bank and a vehicle worth only $4k. I know I have to set up a estate account with all of this but her funeral expenses where over $11k in NJ. She did have a life insurance policy but the beneficary is named to her children not her estate. I don't know if that needs to be included in her estate?

So not ready to do this but I guess I have to... Any help offered would be appreciated.

Your Mom's estate looks pretty small. It might qualify to NJ summary administration, which is simplified. Check with the probate court. You might be able to get letters of administration without too much trouble.

The life insurance proceeds do not need to be included in the estate.

Many credit card companies, upon learning that a card holder has died, will write off the debt rather than pursue it. It probably depends upon how much she owes to any single creditor. Send them a copy of the death certificate and see what happens.

In many states, it is possible to transfer a vehicle to a relative, if fully paid off, without going thru probate. Check the DMV website to see if there is a form available for that purpose.

Unfortunately, for that bank account, you probably are going to need those letters of administration.

babygirl3278:

My mom just passed

Condelences. My mother died in 07. I know how rough it can be. Especially separating the emotional part from the practical part so you can get the probate taken care of.

babygirl3278:

there is no will. I know I need to go to probate court and file for administrator of the estate. She doesn't have much but she does have lots of medical and credit card  bills. Don't know if I should handle this on my own or contact a lawyer

I handled the surrogate court in NY. Takes a little study but a lawyer will cost you a lot. I suggest trying it yourself. If you get bogged down at some point you can consult an attorney.

babygirl3278:

She's not married and it's just me and my younger sister. She only as $1700 in the bank and a vehicle worth only $4k.

That qualifies for simplified small estate treatment since it's under 10,000 and there is no spouse.

babygirl3278:

I know I have to set up a estate account with all of this

Yes, but get your appointment first. Then you'll need an EIN from the IRS in order to set up an account in the name of The Estate Of ___________________.

Getting an EIN can be done online at the IRS website in just a few minutes.

https://sa2.www4.irs.gov/modiein/individual/index.jsp

babygirl3278:

her funeral expenses where over $11k in NJ

What payment arrangements did you arrange with the funeral home? Chances are you personally guaranteed the costs. But that expense can come off the top of the estate assets.

babygirl3278:

she does have lots of medical and credit card  bills.

You'll probably have to sell the car and add the proceeds to the estate bank account. Since funeral expenses (and your fee as representative) come off the top, you will probably just end up advising the creditors that the estate has no money to pay the bills and the estate gets closed and the bills are uncollectible.

babygirl3278:

She did have a life insurance policy but the beneficary is named to her children not her estate. I don't know if that needs to be included in her estate?

No.

Life insurance bypasses probate and the estate.

The money belongs to the two of you and you don't have to spend it on any of her bills or debts.

Now for the how to.

Here's a couple of links to several NJ surrogate courts that have self help instructions and forms. You can get an idea of how everything works from them and google your mother's county surrogate court and see what kind of self help information you can get there.

http://www.co.middlesex.nj.us/surrogate/index.asp

http://www.oceancountygov.com/surrogat/question.htm

http://www.oceancountygov.com/surrogat/question.htm

http://www.co.hunterdon.nj.us/depts/surrog/primer.htm

I know it seems daunting at first but with a little study you'll get through it.

Oh, there's probably a simplified way of transferring the car title. You can look for it on the NJ DMV website.

If you need any more help come back to this thread and I'll see what I can do.

And no matter how nasty some of her creditors may be--tune them out and do not pay them a dime until you have time to get your wits about you and the legal priorities of who gets paid, in what sequence.

Your costs as administrator are likley top of the pile by law--and do not spend a dime of your /her insurance proceeds to pay estate debts--not yet anyway, if at all.

And do not p[esonally sign for anything --if you signed for funeral--try to get it paid next to your fee off top of estate . I believe NJ allows funreal costs to be near front of line.

A car and $1700 won't go far--.

Thanks Kivi... I did need to have the letter of adminstration so I can go through DMV as in NJ if here estate is over $5K they require documentation. Just my luck the estate valued at $5,137.

Thank you again for the helpful information

Thank you so very  much. This information was very useful when walking through the steps. I do have to go to DMV and request a duplicate copy of the title prior to me signing it over to my sister. I guess if thats the lease of my worries I'll be okay.

One question I do have, I set up the EIN number with the IRS, tomorrow I go and close her personal checking and place the monies into the Estate Account. How long do I have to hold this account open for to meet the appropriate guidelines.

It breaks down to this.

Mom's estate is valued at $5,137 which includes the value of her car which was $2,500. After my commission, costs for probate and the funeral the estate is in the hole for over $7K. Therefore I can not pay any creditors.

How long do I have to leave the monies in this account prior to me closing it out? It's my understanding that I have to file a 1040 for 2010 tax year utilizing her estate tax id which should include her W-2 for the portion of the year which she worked and some how incorporate that with the monies in the estate account.

It's probably easier than it sounds I'm just racking my brain.

Again thank you for all of your help

Thank you Drew...

Are you sure that the car doesn't have a few scratches and dings and problems so that its fair market value is really  only about $2100 ?

Hi Drew.. I actually took that into consideration. Fair market value was $3500 but it has some minor mechanical work, a couple of scratches and dings which brought it down to $2500.

babygirl3278:

One question I do have, I set up the EIN number with the IRS, tomorrow I go and close her personal checking and place the monies into the Estate Account

You might not be able to do that without your court appointment papers unless it's a joint account with you and your mother. If that's the case, it's already your money and doesn't have to go through probate or into the estate account.

babygirl3278:

How long do I have to hold this account open for to meet the appropriate guidelines.

Until you close the estate. How and when you do that should be in the instructions and forms you get from the court. You really should be getting all that together first.

babygirl3278:

It's my understanding that I have to file a 1040 for 2010 tax year utilizing her estate tax id which should include her W-2 for the portion of the year which she worked and some how incorporate that with the monies in the estate account.

The 1040 and the estate tax return are two separate filings. But, with an estate that small, you probably don't have to file an estate tax return. You can check on that at www.irs.gov. Use the IRS search feature for estate tax.

The estate account is money that gets distributed to the heirs and does not factor into the 1040 return.

You might talk to your mother's former employer and see if you can pry out a W-2 form a little early.

Then sit down and do a draft of her tax return to estimate whether the estate is going to be owed a tax refund or whether there may be some tax liability. If so, you likely will need to keep the estate account open until such time as you can file that final return, get that tax refund or pay the taxes owed. Unpaid taxes of the decedent generally would be a priority claim over that of other creditors. I don't think the IRS has come out with the 2010 tax forms yet, but you should be able to get a rough idea of where the estate stands using 2009 versions solely for "info" purposes.

If the money is in a joint account with you (post was not clear) then the money may not be in her estate for purposes of that $5000 limit you posted.  Its now yours.

As some of the counting rules are quiky--in my state only 1/2 would count as being there for inheritance tax purposes. I do NOT know NJ rules.

If I was $125 over a limit I might think hard about defensible ways to be $25 below the limit?

adjuster jack:

You might not be able to do that without your court appointment papers unless it's a joint account with you and your mother. If that's the case, it's already your money and doesn't have to go through probate or into the estate account.

I went to our county court house and have the affidavit of heir. And rolled her checking account into an estate account. Her estate account only has the balance of her checking account and a payroll check received after she had passed. Once I deposite the amount of the vehicle value it will only total $5,173.

adjuster jack:

Until you close the estate. How and when you do that should be in the instructions and forms you get from the court. You really should be getting all that together first.

babygirl3278:

It's my understanding that I have to file a 1040 for 2010 tax year utilizing her estate tax id which should include her W-2 for the portion of the year which she worked and some how incorporate that with the monies in the estate account.

Since her estate does not exceed $10K the paperwork from the county surrogates court states that I am entitled to same without letters of administration in accordance with NJSA 3B:10-4. It would be just my luck that  it doesn't indicate how long I need to keep the estate account open. I'll have to look up the code they provided on the affidavit they provided... maybe it will say something useful.

Amazingly, when I went to DMV for my mother's car, they handled all necessary items within 20 minutes.

Thanks for the tip on the tax information. You have been very helpful in this process. It's amazing how complicated this can seem when you have never been through it before.

You might be able to do the tax thing with her final leave and earnings statement or paystub.

Most employers mail them, but some expect employees to access via their computer at work.

Probably would not hurt to call her former employer and ask them to mail that document to you. You also might want to ask about whether she is owed any unpaid vacation time or other employment related benefits, such as 401k plan, while you are at it.