Death of a friend

[Orebell]

What is the name of your state? Oregon

Ok, here is the situation. I am helping a friend and in case your answer is advise him to see an attorney, I have already done that.

There are two brothers and no other siblings. Parents are both deceased. Brother A became ill about a year and half ago. Brother B got power of attorney to hand affairs of Brother A. Brother A does not have a lot of assets, under $100,000 and all in cash and some stocks. Brother does not have a will. Brother A passed away about 3 weeks ago.

Brother B is wondering what happens next. I am trying to help Brother B take care of things like close out bank account, transfer and liquidate stocks, and other things. One of the things that has come up in regards to Brother A's stocks is the brokerage needs some sort of proof that Brother B is the legitimate heir and legal executor. Just so you know, Brother A has never been married and has no children and again Brother B is the only brother. I know this for a fact, but how does Brother B go about getting this "proof"?

We are only talking maybe $3000 in stocks so it is not a huge amount. However, there is one other issue out there. Brother A had a situation with the IRS where he did not file taxes and subsequently a lien was placed on his house and when the house sold, the IRS seized $50,000. During Brother A's illness, I was able to dig up as much of the past of Brother A as I could to figure out why the IRS seized $50,000. It turns out that Brother A, had he filled out the return would not have owed anything at all to the IRS. So a return was completed and filed with the hope that a large portion of that $50,000 would be returned. My concern is that since now that Brother A has passed away, Brother B would be entitled to the refund, but he may need that proof that he is the only heir, I don't know. For $3000, I told Brother B that it may not be worth the hassle, but for $50,000 it sure is.

I have advised Brother B to go to an attorney and I will be happy to accompany him. He probably will go but right now he is dragging his heals. Any advice in the interim would be appreciated.

 

[BlondiePB]

Orebell, the surviving brother needs to take an original death certificate to the courthouse in county where deceased brother was domiciled, open a probate case, and file to be executor/personal representative of deceased brother's estate to access the money with the letters of testamentary/administration that the court will issue him.

Most states have small and/or family administration when the amount is small. If surviving brother does not want to pursue the money from the IRS, that is HIS business not yours. You have NO say-so about this matter, and your POA to deal with the IRS on behalf of the deceased brother is null and void.

 

[Dandy Don]

So exactly WHO submitted/filed the IRS return and was it filed before or after Brother A's death? If Brother B does not know about the tax return, someone should inform him, so that he can consult with a CPA or tax accountant to find out what if anything he will be entitled to receive from the IRS. Sometimes ignorance of the tax law or an unreasonable fear of IRS power causes people to be afraid of the IRS for no valid reason.

DANDY DON IN OKLAHOMA ([email protected])

 

[Orebell]

Helping some friends.

Thanks for the responses so far. I had a feeling that probate would be the answer. To the first reply, you are right if Brother B does not want to pursue the money, there is nothing I can do. I hope I did not imply that I was trying to do anything above and beyond Brother B. I have told Brother B that when his brother was alive, my goal was to help him because a) no one else was going to and b) I knew Brother A would never be able to solve the problems that caused him so much anguish. Now that Brother A is gone, I would like to continue to help, but there really is little I can do. In my opinion, Brother A was a foolish man that made some bad decisions. It was really sad. He was a good man though. Brother B in my opinion is a bigger fool because of some things he has done, or rather I should say a lot of things that he has not done. I don't have any vested interest except that I am trying to help some friends make better decisions.

Now, on to the below reply. Brother B submitted/filed the IRS return for Brother A. Well, actually I had my accountant fill out the return for Brother A, took the return to Brother B for signature via POA and mailed it. Brother B is fully aware of the return and what I have been doing. The return was completed and filed 6 months before Brother A passed away.

Brother B is clearly afraid of the IRS. As I originally stated, I have advised Brother B to meet with a tax attorney and I am willing to go with him to help. I can only do so much. I can tell you that if Brother B did not have someone, like me, pushing, helping him, most likely he would have lost most of Brother A's assets.

Thanks for the comments. Just so you know, in the tax forum I posted a message that was a little more in depth about Brother A's tax situation.

I know that I am only really able to do so much. Brother B had he not had me involved helping him or some other good friend probably would have made out with maybe $70,000 from Brother A's estate. Because I have been involved, he is right now up to $120,000 of Brother A's estate. There is potential for another $75,000 between life insurance and IRS/state tax refund issues that need to be resolved. Brother B could end up with close to $200,000 potentially.

The even sadder thing is Brother B does not have any POA or will set up. So when Brother B passes on, I am guessing it will most likely go to the state since there really are no other relatives. I told Brother B that if he wants his money to go someplace specific when he passes on, he better get it in writing in a will or it will be subject to the laws of the state or some other government entity. That would be sad.

So exactly WHO submitted/filed the IRS return and was it filed before or after Brother A's death? If Brother B does not know about the tax return, someone should inform him, so that he can consult with a CPA or tax accountant to find out what if anything he will be entitled to receive from the IRS. Sometimes ignorance of the tax law or an unreasonable fear of IRS power causes people to be afraid of the IRS for no valid reason.

DANDY DON IN OKLAHOMA ([email protected])