What are a surviving spouse’s debt obligations?

Awhile back, an article in the Star Tribune discussed the egregious practices used by some credit card companies and banks to collect debts owed by deceased persons, often targeting surviving family members who may or may not have a legal obligation to pay.

The question is, when is a surviving spouse legally obligated to pay the credit card debts of their deceased spouse?  We have delved into this topic in two previous blog posts (The Debt Left Behind by a Spouse and What Happens to Debt at Death?) but will address the question again.

In general, the answer is no, a surviving spouse is not obligated to pay the individual debts of their deceased spouse; but like most areas of the law, there are nuances requiring a closer look.

The deceased spouse is liable for his or her own debts, even in death.  According to the Federal Trade Commission, the estate of the deceased person owes the debt. If there isn’t enough money in the estate after death to cover the debt, it typically goes unpaid.

However, a surviving spouse may be responsible for the remaining debt if: (1) you co-signed the obligation; (2) live in a community property state, such as California (Minnesota is not a community property state); (3) state law specifically requires you to pay a particular type of debt; or (4) you were legally responsible for resolving the estate and didn’t comply with certain state probate laws.

The law in Minnesota is found in state statute section 519.05.  It states in relevant part that “a spouse is not liable to a creditor for any debts of the other spouse. Where husband and wife are living together, they shall be jointly and severally liable for necessary medical services that have been furnished to either spouse…..and necessary household articles and supplies furnished to and used by the family.”

Practically speaking, at the time of death, all of the deceased spouse’s individual debts must be paid out of the estate.  This would include payment of monies out of joint banking accounts.  And conversely, if a debt is owed jointly, such as a mortgage or joint credit card, the surviving spouse would remain liable for that debt.  But, Minnesota state law only singles out two types of debt that a surviving spouse would owe in the case of debt owed only by the individual deceased spouse.  If the spouses were living together at the time the debt was incurred, then the surviving spouse would be liable for necessary medical care as well as any “necessary household articles and supplies.”

These exceptions are of course open to some interpretation by creditors, but would exclude items that the household did not necessarily need and enjoy together.