When a man passes away and leaves unpaid debt behind, collection agencies would have the widow believing she has to pay off her husband's debts. In some states with community property laws there may be validity in that claim, but it is complicated even then. Indiana is not a community property state, and a widow cannot inherit debt her husband left behind.
Estate Probate
A probate process is the legal means of settling a decedent's debts and ensuring the terms of her will are carried out as desired. Any assets the decedent owned when she died -- such as real estate, investment accounts and personal property -- are her estate assets at death. The decedent's estate is legally responsible for paying off any outstanding debts. and the probate process takes care of this for her.
Estate Debt Payments
An individual can personally name an estate executor in a will, or the probate court judge will assign one for the estate. The executor must inventory all of the estate's assets and outstanding debts, send death notifications to all involved parties, take care of paperwork or taxes required by Indiana state law, and pay off all debts of the estate before distributing assets to heirs and beneficiaries. By liquidating estate assets, the executor is able to pay off the estate's debts so that no heirs or surviving relatives acquire it.
Remaining Assets
After the executor pays off all of the estate's bills and debts -- including funeral expenses, taxes and probate court fees -- he distributes remaining assets according to the terms of the decedent's will. If there isn't a will, the executor distributes assets according to the terms of Indiana law.
Joint Accounts
In some cases, a surviving spouse can be financially liable for debts after her husband dies, because she was a joint signer on the debt in question. If a husband and wife held a joint credit card account, for example, and it was originally opened with both husband and wife signing as responsible for repayment, then the husband may continue owing that debt after his wife passes away. When in doubt about the legal liability of any debts your dead spouse held, consult with an Indiana probate attorney.
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