After someone passes away different types of debts are handled differently. As Americans continue to accumulate credit card debt, it is important to know how it will be handled by your estate. 

News stories about the high amount of credit card debt that the typical American family has continue to be popular. It is no longer unusual for someone to have more credit card debt than assets. This can create issues for an estate because credit card debt does not automatically disappear when the debtor passes away. It still needs to be paid by the estate if possible.

The Deseret News discusses the different possibilities in a story titled "What Happens to Credit Card Debt When Someone Dies?" Basically, any credit card debt will have to be paid out of any assets the estate has. The debt must be paid before any heirs can inherit. The good news is that in most cases no one will inherit the debt. If there are not enough assets in the estate to pay the debt, then in essence the debt ceases to exist. However, there are some exceptions. In community property states, a surviving spouse will be responsible for any unpaid credit card debt. A joint owner of the credit card account would also still be responsible for paying off any remaining debt in the account.

It is important to understand how your debts will be paid off after you pass away. If you have credit card debt, or any other type of debt, speak to an estate planning attorney about what you might be able to do today to plan for paying off your debts while still leaving some assets for your heirs to inherit.

For more information about estate planning, visit our website at

Reference: Deseret News (July 18, 2014) "What Happens to Credit Card Debt When Someone Dies?"

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