It’s December 26th as I write this. I remember when I lost my wife in late November, and remember how unprepared I was to deal with financial issues in the moment. I made mistakes that cost me later, so let me keep this simple. Talk to your accountant or financial advisor immediately about whether there are any things you need to do before January 1st that will help you in terms of taxes.
For example, it’s late to address this, but if you and your spouse had stocks and your spouse did most of the investment management, December is the time to decide what capital gains to take or capital losses to absorb that will put you in a favorable position.
Here’s a link you can paste into your browser to an article from Citigroup that you might find helpful:
A more detailed article that addresses taxes directly is from H&R Block:
Here are the three most important things you should do if you haven’t already:
CALL YOUR ACCOUNTANT
- ask if there is anything left for you to do tax-wise before December 31st.
- ask if you have losses carried forward from previous years. You’ll need this information for point 3 below.
CALL YOUR LAWYER—ask the same question, but specifically about estate taxes
CALL YOUR BROKER
- If you haven’t spoken to the broker because your spouse handled everything, have a death certificate handy. You may need an original. [By the way, if you haven’t yet gotten a bunch of originals, go to your town or county clerk TOMORROW and do this].
- It’s late for this and the broker will complain, but if you had losses to carry forward from previous years, you may want to sell some things that have had big gains so that you can take the gain tax-free. You can’t carry forward losses forever, so next year can be too late.
If you have financial advice for others in this situation, please register (free) for the AfterTalk forum on Financial Planning After a Loss.