What’s the process of inheriting money?

[Anonymous]

When my final parent passes, what do we need to do to inherit?

***There is an updated will and trust in place.***

***I am main executor and sibling is named to do it if I don’t want to.***

We are beneficiaries on all retirement policies so those will be distributed to us through the financial companies, I think??

There is quite a bit of cash in a bank account. Our names are on this account, which I now know is not ideal. But I assume we can roll this over into our accounts?

When the parent passes, I know I’ll be stressed and my sibling’s anxiety will spiral so I’d like to have an understanding of this now.

Yes, I can hire an estate lawyer and we did that to create the will but now I am wondering about the technicalities.

[Anonymous]

For retirement accounts if you are named as the beneficiary, you just call them and they will transfer it to you. It's easy if its fidelity, vanguard, etc. If it's split, they will split it for you. You need to open an estate, pay the bills and taxes and then split what ever money is remaining.

[Anonymous]

You will need to provide death certificates for each of the financial institutions. And they will tell you about what paperwork needs to be filled out. Sometimes you'll have to get a notarized signature that you are who you claim to be, etc. It's a bureaucratic process that can take a several months. And you won't be able to change the investment mix until you gain control of the accounts, so depending on how the market is, the value on date of death may be significantly up or down from the time you actually gain control of the assets.

Keep a file of the value of these assets on the date of death, as that's their new basis for future sales.

I'm not sure why it's a problem for your names to be on the bank account now - I assume you'll have immediate access to them.

And there is probate for the assets that need to go through probate.

Keep communication open with your sibling to help manage the anxiety and expectations. Let them know that the process will likely take many months, and may stretch to a year or more.

[Anonymous]

Retirement accounts will pass via a transfer on death (TOD). You should ensure you and your sibling are named.

Checking and Savings can pass via a transfer on death (POD. You should ensure you and your sibling are named. If you are joint owners on the account you already have access.

Insurance policies also pass to named beneficiaries. Check and make sure your name is there.

Cars, furniture, personal possessions usually go thru probate. The less financial items in probate the better. You will file probate and that is a process within itself.

Real estate will pass per the will or a transfer of deed if set up. This is a tax advantage for you since you get a stepped up basis. If you are already on the deed, you will face taxes.

In the county or city of death, you will need to be sworn in as the executor. The process varies but you will need the death certificate and the will. You should research this now to become familiar with the process. In Virginia the process is state law but administered by each locality.

Death Certs come from the funeral home. This is step #1. Then get sworn in as executor. It could take a month before you are executor.

Even with estates that have a plan and have done all of the right planning steps, being an executor is a lot of work. You will spend a lot of time on the phone with everyone to get the deceased assets’ moving. No two processes are the same and everyone requires different paper work etc. It isn’t complicated, but it takes time and things work in a serial fashion. Plan on using excel to track everything and good old fashioned file folders. Lots of paperwork, it is like managing a project. You also have to deal with all of the emotional parts as well. Cleaning out a house of possessions can be tough.

You will have to file taxes for the deceased for the year of their death if they had not. Expect to still be dealing with some items a year after death. Longer if the estate is complicated.

[Anonymous]

I’m PP, I missed the trust mention. A trust will make things more complicated, more work for you, longer timeline.

[Anonymous]

Actually a trust expedites thangs and makes it easier. You won’t need to go through probate and everything stays private.

[Anonymous]

Anonymous wrote:Actually a trust expedites thangs and makes it easier. You won’t need to go through probate and everything stays private.

Yep, great point.

[Anonymous]

Anonymous wrote:Retirement accounts will pass via a transfer on death (TOD). You should ensure you and your sibling are named.

Checking and Savings can pass via a transfer on death (POD. You should ensure you and your sibling are named. If you are joint owners on the account you already have access.

Insurance policies also pass to named beneficiaries. Check and make sure your name is there.

Cars, furniture, personal possessions usually go thru probate. The less financial items in probate the better. You will file probate and that is a process within itself.

Real estate will pass per the will or a transfer of deed if set up. This is a tax advantage for you since you get a stepped up basis. If you are already on the deed, you will face taxes.

In the county or city of death, you will need to be sworn in as the executor. The process varies but you will need the death certificate and the will. You should research this now to become familiar with the process. In Virginia the process is state law but administered by each locality.

Death Certs come from the funeral home. This is step #1. Then get sworn in as executor. It could take a month before you are executor.

Even with estates that have a plan and have done all of the right planning steps, being an executor is a lot of work. You will spend a lot of time on the phone with everyone to get the deceased assets’ moving. No two processes are the same and everyone requires different paper work etc. It isn’t complicated, but it takes time and things work in a serial fashion. Plan on using excel to track everything and good old fashioned file folders. Lots of paperwork, it is like managing a project. You also have to deal with all of the emotional parts as well. Cleaning out a house of possessions can be tough.

You will have to file taxes for the deceased for the year of their death if they had not. Expect to still be dealing with some items a year after death. Longer if the estate is complicated.

Re: last paragraph - I don't think it would be possible for a decendent to have filed their final tax return ; )

[Anonymous]

Anonymous wrote:Actually a trust expedites thangs and makes it easier. You won’t need to go through probate and everything stays private.

It depends. I had a nightmare of a time when my mother passed away; lots of problems and stress thanks to a very poorly drafted trust.

[Anonymous]

Anonymous wrote:You will need to provide death certificates for each of the financial institutions. And they will tell you about what paperwork needs to be filled out. Sometimes you'll have to get a notarized signature that you are who you claim to be, etc. It's a bureaucratic process that can take a several months. And you won't be able to change the investment mix until you gain control of the accounts, so depending on how the market is, the value on date of death may be significantly up or down from the time you actually gain control of the assets.

Keep a file of the value of these assets on the date of death, as that's their new basis for future sales.

I'm not sure why it's a problem for your names to be on the bank account now - I assume you'll have immediate access to them.

And there is probate for the assets that need to go through probate.

Keep communication open with your sibling to help manage the anxiety and expectations. Let them know that the process will likely take many months, and may stretch to a year or more.

Your post taught me several things I need to know. I appreciate you taking the time to share this.

Thank you!

OP

[Anonymous]

Immediately I was able to access the accounts I was listed to receive. So if the will said 100k, I could get that immediately. I had to have a notary sign with me and then I got a check.

The other stuff like 50% of a house took a lot longer and had to wait until the house sale. We also had to have money to pay whatever taxes and last bills were owed

[Anonymous]

Anonymous wrote:I’m PP, I missed the trust mention. A trust will make things more complicated, more work for you, longer timeline.

Thank you. Only the house is in the trust and we may end up selling that before.

[Anonymous]

My remaining parent had a trust with in which my sibling and I were named. Our names were on the bank accounts. After providing death certificate as needed, monies, house proceeds and equities were divided and distributed equally.

The car was not in the trust, so that had to go through probate.

The most difficult part was making sure all bills were paid and income taxes filed.

Basically, it really was a matter of being organized, and be transparent about everything with the sibling who didn't have the skills to deal with it all.

[Anonymous]

I’ve created a task list from what you all have shared.

Thank you so much! We have done a lot of planning, yet I still worry I’ve missed something despite that.

The financial planner said we are beneficiaries on retirement accounts under him but neither of us has seen this in writing so I’d feel better if we saw that indicated on a document rather than just verbal confirmation. I have to find out how to get that info. Maybe I will call the institution with my parent on the phone with me to verify.

For a different financial institution, I was able to call and speak to someone who confirmed we are both listed as beneficiaries.

—The house is in a trust.
—The car, furniture, etc will go through probate unless we retitle the car.
—We are on the bank accounts, so that can roll to us after we pay bills.
—I’ll visually check retirement accounts to ensure we are listed as beneficiaries. If so, these will be split by the institutions once we have provide the death cert and any required paperwork.

[Anonymous]

Make sure to make a good list of personal property, the values of all the items, and how all the items are distributed or disposed of.

I have a neighbor who was executor for her parent’s estate. She got overwhelmed and apparently did not keep track of all the possessions from her parent’s house. She says she just gave everything away to various people and even just threw away many of the possessions, but her siblings are now asking questions about where is this and where is that and she can’t answer.

You don’t want to get in a situation where you can’t answer questions about the values and distribution of the possessions of your parents, so make sure to keep a good inventory that lists everything of value.