Who Is Responsible if a Deceased Person Owes Taxes?

August 21, 2023

Unfortunately, tax burdens (with the exception of student loan debts) don’t magically disappear in the event of a person’s death. They are still owed by the deceased’s estate, which means a tax return must be filed on their behalf. One of the most important jobs for the executor named in the Last Will and Testament–– at least in the eyes of the state––is to settle these debts with the appropriate government entity. 

Who Has to Pay Taxes For the Deceased?

The estate pays the taxes—it doesn’t come out of someone else’s bank account.

The executor (or personal representative) of the estate named in the will, however, is responsible for paying those taxes on behalf of the deceased.

If the deceased didn’t leave a will, then a relative or spouse typically “steps up” to be appointed by the court after petitioning the court to begin probate.

Do Beneficiaries Have to Pay For Debts Left By the Deceased?

Unless you owned those debts with that person, then the answer is no. Beneficiaries are not automatically responsible for someone’s debt.

However, in Louisiana, because of community property laws, there are some exceptions. Community property laws assert that anything bought during a marriage is technically owned by both spouses. 

If you are unsure of how these issues may affect your estate or fear you may be responsible for a lot of unresolved debt, reach out to us today. 

Are Debts Forgiven at Death?

No. A person’s outstanding debts, excluding federal student loans, have to be paid from whatever that person owned.

Taxes are just one part of the debt an estate must pay. You also need to file notice to creditors to officially announce that the person has passed. This starts a clock for creditors to collect any balance owed. If they don’t do it in the appropriate time frame (and you’ve properly filed notice), then they forfeit their right to that money.

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