Do This 1 Thing Every Year to Help Your Family

Helping clients settle deceased loved ones' estates has exposed me to all sorts of unique problems (and smells and sights) that I could never have anticipated. It is not the unique situations, however, that prompt me to write this post. Rather, it is the run-of-the-mill things we do (or don’t do) while living our lives that seem to affect only us at the time, but which can have significant effects for those we leave behind.
Currently, I am working on an estate where the deceased passed away with significant debts and a farming operation. That combination makes for a good challenge, but once we got a handle on the debts and sold the farm, we were in pretty good shape. Then, it came time to file the final tax return of the deceased. And guess what we discovered? The last time a tax return had been filed was 2008. To top it off, the deceased had substantial income as an independent contractor for the last few years of life. Now the heirs are in the unfortunate position of trying to determine business expenses that would have offset the tax obligation. I’m not sure about you, but I have trouble remembering what happened over the last year when I’m doing my taxes. Imagine deciphering years of a parent’s business expenses. This is no small task, and now it is holding up the estate and costing money, time and effort, not to mention the threat of a tax liability that could drain whatever funds are available for other creditors and the heirs.
Taxes aren’t exciting or fun for most of us, and we’d all rather spend our time doing other things. But, it would really help out your next of kin if you would (please) file your taxes while you’re here so we don’t have to fix a major problem when you’re not.