Author Topic: 2022 Tax Question - Person Passed Away Spouse Advice  (Read 401 times)

Loren Ver

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2022 Tax Question - Person Passed Away Spouse Advice
« on: November 13, 2023, 07:06:42 PM »
Hello Experts,

Question for a friend (actually a family member of friend, so my details are slim, but that is too long to type each time).

Friend married in Oct-ish 2023.  The husband died Nov 2023.  Friend just opened a letter that there are taxes due for husband from 2022 (so before married). 

Questions:
Does friend need to see that this money is paid?
Will the IRS take money from the estate, last wages (there aren't many pay checks remaining) etc?
If the money will be paid, should friend get on a payment plan?  Will this stop the amount from growing (fees, interest etc)?

Or otherwise stated, is the money still owed if the person has passed away and there is a surviving spouse that wasn't a spouse when the taxes weren't paid?

Thank you for your help!   Friend tried calling the IRS, but no one picked up.  Google gave mixed results.  It is already a difficult and confusing time, so getting straightforward answers is such a wonderful thing.

Loren

secondcor521

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Re: 2022 Tax Question - Person Passed Away Spouse Advice
« Reply #1 on: November 13, 2023, 09:04:25 PM »
If the husband had assets when he died, then the taxes should be paid from his assets.

The person responsible for making sure this happens is the husband's executor.  That could be the surviving spouse, a child of the husband, or someone else.

The executor will be named in the husband's will.  If there is no will, then someone can ask the court to be made executor - this would typically either be a family member who would become a beneficiary, or it could be a creditor like the IRS or a credit card company.

States - the one that matters is the one he lived in when he died - have different rules for in which order debts must be paid.  It's usually some combination of last medical expenses, funeral/burial expenses, then taxes, then everything else.

If the executor does not follow the state prescribed order for paying debts before distributing assets, then any debtor can sue the executor personally for the debt.  I don't know if the IRS would pursue it or not - probably depends on how much he owes.  They could also turn the debt over to a collection agency.

If the assets are not sufficient to pay the IRS (and other debts), then the friend should be advised to not get involved.  Since they are his separate debt from prior to marriage, I don't believe she is responsible for them and the IRS should understand that.  So she shouldn't get on a payment plan - either his assets cover the IRS debt and it should be paid, or they don't and she should stay out of it.

Loren Ver

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Re: 2022 Tax Question - Person Passed Away Spouse Advice
« Reply #2 on: November 14, 2023, 09:44:40 AM »
Thank you for replying. 

The executor is their adult child. 

The state is Ohio. 

I don't know what there will be for estate.  I know there will be a small life insurance policy ($10,000) paid to the wife (friend).  But not something you want to spend on a tax bill if you aren't responsible. 

The tax bill wasn't very big $1,900 range after fees/interest.

Loren



secondcor521

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Re: 2022 Tax Question - Person Passed Away Spouse Advice
« Reply #3 on: November 14, 2023, 10:08:58 AM »
The wife/friend should hand the IRS notice to the adult child because they are the executor.  It is the executor's responsibility, not the wife/friend's.

The adult child probably should find out who owned the life insurance policy.  If it was the deceased spouse, then I think but am not sure that the $10K in proceeds may need to be directed to pay the $1900 tax bill.  Check the Ohio state laws on that.

If the laws say that the $10K does need to be used to pay debts of the deceased and the wife/friend has already received the $10K proceeds, that can either be a friendly discussion, or it could get contentious and involve lawyers and courts as I'm sure you can imagine.

The adult child, as executor, may want to file a change of address with the post office so any future mail addressed to the deceased spouse goes to them rather than the wife/friend.  And they may want to work with an estate attorney to work through the process.  If the estate meets the small estate requirements (check Ohio laws) and adult child is willing to learn the ropes, then DIY is possible.

Loren Ver

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Re: 2022 Tax Question - Person Passed Away Spouse Advice
« Reply #4 on: November 14, 2023, 12:15:56 PM »
Thank you!  I will pass this information along.  Hopefully it will be helpful.