When a spouse passes away, the surviving partner is faced with an emotionally difficult and challenging time.
While grieving, the surviving spouse may also be responsible for handling certain legal and financial matters, including determining whether they are responsible for their deceased spouse’s debts.
This article addresses the commonly asked question, “Am I responsible for my deceased spouse’s debt?” and provides an overview of the laws and considerations surrounding this issue.
Debt in America
Most Americans carry some form of debt, including credit card balances, student loans, mortgages, or personal loans. On average, Americans carry more than $90,000 in debt, and collectively, consumer debt in the United States exceeds $14 trillion, with mortgage debt representing the largest share.
Debt affects people of all ages, including those later in life who may still have significant financial obligations at the time of death.
Probate and Debt Payment
When a person dies, their property is distributed according to their will or, if no will exists, through their legal heirs via a court-supervised process known as probate.
During probate, outstanding debts must be paid before any assets are distributed to heirs or beneficiaries. However, certain assets are not subject to probate, including:
- Life insurance policies with a named beneficiary
- Accounts with designated beneficiaries
- Assets held in trust
- Jointly owned property with rights of survivorship
Each state has its own rules for the order in which debts must be paid, but generally, funeral expenses, estate administration costs, taxes, and other debts are paid in a specific priority.
Liability for a Spouse’s Debts
In certain circumstances, a surviving spouse may be legally responsible for paying some or all of their deceased spouse’s debts. This may occur if:
- You co-signed a loan with your spouse
- You are a joint account holder on a credit card or loan
- You live in a community property state
There are nine community property states in the United States. In these states, most debts incurred during the marriage are considered jointly owned, regardless of which spouse incurred them.
If the estate is insolvent and unable to pay its debts, creditors may pursue the surviving spouse for payment. This can include debts such as medical bills and credit card balances, and in some cases, creditors may be able to garnish wages, place liens on property, or seize funds from bank accounts.
Exceptions may apply under community property laws, and you may only be responsible for debts incurred during the marriage. Because these laws vary by state, it is critical to consult with an attorney who focuses on estate planning and administration to understand your specific rights and obligations.
Why Legal Guidance Matters
Understanding your responsibilities and rights related to your deceased spouse’s debt is especially important during an already difficult time. Estate and debt laws can be complex, and mistakes may have lasting financial consequences.
An experienced estate planning and administration attorney can provide clarity, protect your interests, and help you navigate creditor claims and probate requirements.
If you require legal assistance with wills or estate planning in Maryland, you may schedule a complimentary initial consultation with the Bauhof Legal team. Every estate is unique, and this website is not intended to provide legal advice. Please contact us at brad@bauhoflegal.com or call +1 (410) 876-4500.
