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Are life insurance proceeds considered part of a deceased person's estate?
Asked by: WorriedinNJ
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I am an only child and my father is elderly and ill. I will be the sole heir and executor of his estate in NJ.
He has a reverse mortgage on his home without any equity left and 36K of credit card debt.
When he passes away, I understand that the creditors have to be paid from what is left of his estate. My questions are:
1) I am the beneficiary of his life insurance policy and IRA's, which amount to less than the credit card debt.
Are these considered part of his estate? So, will I not be able to collect those?
2) I live in his home and care for him, will all the home furnishings be considered part of his estate, eventhough some belong to me, because they are in his home?
Thank you
He has a reverse mortgage on his home without any equity left and 36K of credit card debt.
When he passes away, I understand that the creditors have to be paid from what is left of his estate. My questions are:
1) I am the beneficiary of his life insurance policy and IRA's, which amount to less than the credit card debt.
Are these considered part of his estate? So, will I not be able to collect those?
2) I live in his home and care for him, will all the home furnishings be considered part of his estate, eventhough some belong to me, because they are in his home?
Thank you
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With regard to the home furnishings make a list of what is yours and date it. At least that would be a minimum precaution.
My understanding is that life insurance is not a part of the estate. I once had a debate with an attorney about this and I won the debate. He finally agreed with me and I am not an attorney. I mention this because there can be differences of opinion.
The heir(s) of the IRA can have their respective portions of the deceased'...
My understanding is that life insurance is not a part of the estate. I once had a debate with an attorney about this and I won the debate. He finally agreed with me and I am not an attorney. I mention this because there can be differences of opinion.
The heir(s) of the IRA can have their respective portions of the deceased'...
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If you are the beneficiary of his life insurance policy, then that becomes a part of your estate after your father's death. His estate would be everything he owns, which, when liquidated, will go directly towards paying down his outstanding debts. Your furniture is not part of the estate. You may need to use the IRA's and life insurance proceeds if you choose to, to assist in payment of his debt. Most credit cards are insured, and upon the cardholder's death, are paid in full! Check to see if this is the case....
Answer Date: 03:17am 08/02/08
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