Probate Tidbit No. 5 -- Unpaid Bills and Debts of a Decedent.

Tidbit No. 5
In Probate Tidbit No. 2 posted recently, we discussed briefly Creditor's Claims in probate.

But what happens if the person who died left bills or incurred bills as a result of dying. Medical bills, unpaid credit card bills, the last gas bill, the you-name-it bill... are you responsible for paying these bills?

Generally, if you are not the surviving spouse, you are not responsible for paying the bills of someone who has passed away. A surviving spouse may be responsible for the bill as California is a community property state and that includes debts incurred during marriage.

If, however, you signed a guarantee, promise or any other contract that obligates you to pay -- of course you are on the hook for those bills.

Getting back to the substance of the post, if your loved one's estate is insolvent, contains no cash, has no assets that can be sold (car, house, etc.) and there are outstanding bills... you are not responsible for those bills personally.

Do not offer to pay a bill that is not yours.

If probate is opened for your loved one's estate, these Creditors (aka the folks demanding payment) should get notice through the probate proceeding and can file a claim against the estate to get paid. Hence, the Creditors Claim process as already discussed and relinked here.

What happens if the bill doesn't get paid? To put it bluntly, it's the Creditor's problem and will be written off as unpaid/uncollected. Do not interpret this as meaning it is ok to run up a shopping spree and then die broke. That just raises the interest rates and cost of goods sold for the rest of us.

It goes without saying that if you are unsure about a bill or other debt belonging to someone who has died, please consult with an attorney who handles probate as a routine part of his or her practice to determine how it should be handled legally.