2007-03-28 07:29:03 · 4 answers · asked by gardeniadove 1 in Politics & Government ➔ Law & Ethics
After you die, all of your worldly possessions - money, real estate, stocks, jewelry, all other valuables - become part of your estate.
Your consumer debt (unsecured credit cards) is usually blown off, but the IRS will come after your estate for back taxes.
If you have a lot of debt, you need to plan ahead to avoid your estate being looted. You are allowed to give gifts to family and friends that are tax exempt before you pass. Make sure your will specifies who gets what, and who will be in charge of your estate paying your final expenses (funeral).
A little planning can save your family from hassles after you pass.
2007-03-28 07:41:00 · answer #1 · answered by gw_bushisamoron 4 · 0⤊ 0⤋
Nope. Not unless they signed the debt agreement with you. Now if you leave an estate to your next of kin, they may be able to make a claim against the estate and if they win a judgement they would get their cut before the next of kin. Or if you had placed any part of the estate up as collateral for a debt the debtor can reposess the asset and sell it to recover.
2007-03-28 14:39:17 · answer #2 · answered by Sane 6 · 0⤊ 1⤋
Not generally. Debt dies with the debtor. However, of course, all of your creditors can attempt to get their debts paid off from your "estate." Just about all of your assets can be levied against before they're passed on to your next of kin. So, for example, if the bank has a mortgage on your home, that mortgage continues to exist. The next person can take your property subject to the mortgage, or can sell the property, pay off the mortgage, and keep any overage.
However, if your estate has negative equity (i.e. you owe more than your estate can pay) those debts will not be passed on to your next of kin.
A number of good estate planning attorneys can help you decide how to prepare to maximize the gifts to your family and friends while avoiding taxes and other debts. It may be worth it for you to consult them.
2007-03-28 14:36:34 · answer #3 · answered by Perdendosi 7 · 1⤊ 1⤋
debts are part of one's "estate." when you die, funds are paid through your estate.
For example, let's say that you have $100,000 and 2 children who are your only heirs. You would probably want $50,000 to go to each child. But if you have debts, those debts are paid FIRST. So if you have $20,000 in credit card debts, then when you die those debts are paid and your heirs are left with $80,000
2007-03-28 14:43:18 · answer #4 · answered by jdphd 5 · 0⤊ 0⤋