Am I Responsible For My Deceased Parent’s Debts In Louisiana? Understanding Your Liabilities.

In Louisiana, as in most states, the general rule is that you are not personally responsible for your deceased parent’s debts. Financial liabilities a deceased person leaves are typically settled through their estate during the probate process.

Here are some key points to consider:

• Estate responsibility: The deceased person’s estate is responsible for paying off any debts, including using any assets or property they left behind. Creditors can make claims against the estate during the probate process.
• Community property: As a community property state, Louisiana considers debts incurred during a marriage as joint debts. Your parent’s surviving spouse might be responsible for some of the debts incurred during the marriage.
• Co-signed debts: If you co-signed a loan or credit card with your parent, you would be responsible for that debt.
• Secured debts: For secured debts, such as a mortgage or car loan, the lender may repossess the property for unpaid debt.
• Executor role: If you are the executor of your parent’s estate, you are responsible for paying off debts from the estate’s assets before distributing any remaining assets to heirs.

Certain exemptions and protections might apply depending on your circumstances, so it could be beneficial to get knowledgeable legal guidance specific to your situation. Probate attorney R. Scott Buhrer has advised clients on these and other complicated succession issues for over 35 years.

What Happens If My Parent Dies Without A Will?

If a person dies without a will in Louisiana, they die “intestate,” and the state’s intestacy laws determine how to distribute their estate.

Here is a general outline of what happens in this situation:

1. The court will appoint an administrator (also known as an executor or personal representative) to manage the estate. This person is typically a close relative or someone with an interest in the estate.
2. The administrator will inventory the deceased person’s assets and debts.
3. The administrator will use the estate’s assets to pay off any debts and expenses, including funeral costs and taxes.
4. After paying debts and expenses, the administrator disperses the remaining assets according to Louisiana’s intestacy laws. The distribution follows a specific order of priority:
   • If the deceased has a surviving spouse and children, they divide the estate between them. The spouse receives the deceased’s share of the community property (property acquired during the marriage), while the children inherit the deceased’s separate property and any remaining community property.
   • Children inherit the entire estate if no surviving spouse is present.
   • The surviving spouse inherits the estate if there are no children.
   • The deceased’s parents and siblings divide the estate if there is no surviving spouse or children. If only one parent is alive, that parent shares the estate with the siblings.
   • If there are no immediate family members, the estate may go to more distant relatives, such as grandparents, aunts, uncles, cousins, etc.
5. If there are no living relatives, the estate will escheat (revert) to the state of Louisiana.

It’s important to note that the specific details of intestate succession can be complex, and the exact distribution may vary based on individual circumstances.

Some Assets May Bypass Intestate Succession

In Louisiana, certain assets can pass directly to beneficiaries, regardless of whether the deceased had a will. These assets typically have designated beneficiaries or involve survivorship rights.

Here are some examples:

• Life insurance proceeds: If the deceased had a life insurance policy with a named beneficiary, the proceeds generally go directly to that beneficiary and not through the probate process.
• Retirement accounts: Accounts such as IRAs, 401(k)s and other retirement plans typically pass directly to named beneficiaries.
• Payable-on-death (POD) accounts: Bank accounts or others designated as payable-on-death transfer directly to the named POD beneficiaries.
• Transfer-on-death (TOD) securities: Stocks, bonds and other securities with transfer-on-death designations will go directly to the named beneficiaries.
• Jointly owned property with right of survivorship: Assets owned under this arrangement pass directly to the surviving co-owner. This can include real estate, bank accounts and other jointly held assets.
• Trust assets: Any assets placed in a trust are distributed according to the terms of the trust and bypass the probate and intestate succession process.
• Community property with usufruct: In Louisiana, the surviving spouse may have a usufruct (a right to use and enjoy the property), especially if there are children. This can alter the handling and distribution of certain assets.

While these assets bypass the intestate succession process, they must be properly documented and managed. Consulting with an experienced estate planning attorney can provide clarity and ensure that all assets are accounted for and distributed according to your wishes or the wishes of the deceased.

Contact A New Orleans Succession Lawyer Today

Attorney Buhrer has provided compassionate and skilled advice for Louisiana probate matters, including contested successions, for over three decades. Call 504-541-6997 or contact the Buhrer Law Firm online to request a consultation today to discuss your legal needs, and we’ll schedule your appointment.