Death in America (Part III)

It is about time for an update. After nearly three months my mother-in-law’s estate is officially up and running. My wife has her Letters Testamentary from the court in Georgia. Her mother’s CPA prepared the form for obtaining a tax ID for the estate. Now a tax ID number has been issued. We are beginning the process of converting accounts from my mother-in-law’s name to that of her estate. Of course this requires more paper, death certificates, a notarized affidavit of domicile (haven’t seen one of those yet), a official copy of the Letters Testamentary, and forms, lots of forms, complex incompressible forms, with pages of instructions in very small print.

The process of closing out my mother-in-law’s affairs outside of the estate also continues. The worst problem has been the ambulance bills. They run from $850-$1,050 per trip. My mother-in-law made quite a few trips in her final month. The process involves the ambulance company, the insurance company, and the hospital. The ambulance company is supposed to present the bill to the insurance company with the trip report (they always send the bill but not the trip report). If there are any questions the insurance company is supposed to contact the hospital for a detailed diagnosis to determine if the trip was an emergency. Often the hospital does not respond to these requests, so the insurance company denies the claim. Then the ambulance company sends out an angry letter threatening to ruin my mother-in-law’s credit score before turning her over to a collection agency. Then we make more phone calls.

Patience and Persistence

For the first time the tax consequences of my actions are a very important consideration. Some of my father-in-law’s investments were in tax sheltered vehicles such as IRAs, a 403b, and tax deferred annuities. Our attorney has counseled us to consult with our CPA after fully understanding the options available when moving these investments. By the way, companies do not like it when you choose to move money from their control to another financial institution. The process is complex.

Privacy laws have led to extraordinarily silly behavior. My mother-in-law had health insurance through her husband’s employer. They debited one of her checking accounts for a little over $200 a month to pay for the insurance, a bargain that saved the family a fortune. However, they continued to debit the account after her death. They were notified of her death. They had the death certificate but they were not notified by the proper institution in the proper manner, so they could not stop debiting the account. In a phone conversation (one of about 12 or more with various institutions involved in this process) a phone representative asked for all sorts of information, social security number, date of birth, address to establish I knew my mother-in-law. Then she announced she couldn’t talk to me because I wasn’t my mother-in-law. The fact that she was dead didn’t matter. I wasn’t on the list. “Who is on the list?” I queried. She couldn’t tell me who was on the list. However, I gave her my wife’s name and after some hesitation she decided she could tell me that my wife’s name was on the list. All’s well that ends well. Someone who was previously informed the day after my mother-in-law’s death forgot that little detail. She promptly fixed the problem and the estate will be refunded the erroneous charges.

P.S. Remember, CDs, brokerage accounts, annuities, and like can be designated to a sole beneficiary. If that is what you want done with these funds, they do not become part of the estate. Hence you can keep them out of probate. Worth thinking about as you plan your estate.