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What to Do Immediately Following a Spouse's Death
Estate Administration
The death of an individual does not preclude the need for tax planning. Consideration of this aspect should take place even after death during the estate administration process. While Ann is somewhat beyond this early stage, there are valuable steps in the process that can help protect the estate's assets.
- An income tax return needs to be filed for the decedent upon their death. You should work with a tax advisor who can help you determine whether you should file a joint return or a separate return for your deceased spouse. Usually, a joint return results in less income tax but you need to calculate it both ways before deciding.
- If you are acting as the executor of the estate, you should consider waiving your commission to avoid income taxes. The commission is the fee for serving as executor. When the surviving spouse is appointed as executor and is entitled to receive the estate, then the commission should be waived so income taxes will not have to be paid. Estate administration expenses can be deducted on the federal estate tax return or on the estate's federal income return, but not both. The executor is responsible for determining which would be most beneficial.
- For larger estates, a spouse could consider disclaiming property to avoid future estate taxes. Disclaimed property would instead pass to children or other heirs named in the will instead of the deceased spouse.
 More Steps to Take
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