Payout of final paycheck after death

Pork · December 2002

Last week we had an employee get murdered after hours. To whom do we make the final payroll check payable? Two years ago we had an employee killed over the week end and we made the check out to the individual and it was mailed and collected upon by the decessed next of kin through the family bank. This time we are aware before we make the check out and mail? From our legal members what is the proper way of handling this final payout? From our HR experienced what is your advice?

Peyton Irby MS · December 2002

there is a statute in mississippi, as in most states, that covers this issue. the check goes first to the spouse, then adult children, then a parent. if only minor children survive, their guardian is next in line. if none of the above, to the chancery clerk of the county where the employee resided. assuming you are at the chancery clerk stage, call that office first before delivery. the clerk's office does not get many checks.

Pork · December 2002

Peyton, thanks, there are two daughters, do I "by law" make the check out to him and let them worry about getting it cashed, or do I get their names and write the check to each 50/50? How do we report this to IRS for w-2 purposes, if we write the check to them? or should this not be a payroll check, but a accounts payable check to both daughters? Lots of questions I hope you have the answers, I do not want to get more legal fees at $175.00 per hour when I can get it from my HRhero buddies!!! Pork

Parabeagle · December 2002

Pork, check with your Department of Labor folks in MS. We have a multi-state operation and had an employee die in the state of Washington (I'm most familiar with Oregon law) -- I was AMAZED at the hoops I had to jump through to get the check to his next of kin! Had it not been for a helpful state employee (yes, they DO exist), I'd still be figuring out what was owed to whom.

Anita · December 2002

When the President of our company died, I made the checks out to the "Estate of XXX XXX". And sent it to his last known address. I knew that he had a wife, but was told by our lawyers that it should be done this way, then it becomes part of the estate and is distributed correctly, that way it still goes under the deceased for w2 purposes.

Pork · December 2002

Thanks folks: here is what we did; attempted to contact my friendly and usually reliable local office, but due to staffing and budget restraints we now get a voice message machine; the person who used to be in the office helping people has now been put on the road harassing employers.

We figured out the employees earnings with taxes collected. I have made out an accounts payable check for both daughters splitting the net 50 / 50. I will have them sign for the checks and relieve my company for an liability claim by next of kin!

All other dollar values are covered by a "by law beneficiary form"! I hope it works; it is for sure clean unless one of the daughters is written ourt of some last will and testiment which is currently unknown.

Rockie · December 2002

I would think if the individual was deceased. the final paycheck would be party of the estate and made out to "The Estate of ".

Pork · December 2002

UP-DATE: Our logic was not good enough! OOPs back up and do it all over. The checks are made out to the "deceased employee" in his name and with the computations of the taxes owed and paid to the W-2 and State tax accounts of the deceased employee. Uncle Sam and Sam Jr. must get their money regardless of the inconvience of the next of kin.

On the 26th of December sister number 2 will pick up the checks and mail them to sister number 1 for her signature and endorsement on the back of the checks. Sister number 1 will sign and mail back to sister number 2. Sister 2 will then take the checks to our bank along with death certificate of the named "deceased employee". Along with the death certificate, sister number 2 has the identifying documents of the other sister along with her identifying documents. Once at our bank the bank officers will examine all documents and cash the checks allowing sister number 2 to have the cash pertaining to the checks. She will then handle the dispersement of the cash in accordance with the agreed instructions of sister 1 with sister number 2.

WOW, it is fun to be an HR with such wonderful opportunities to succeed and be blessed for being on this world. May we all have a blessed Christmas 2002 and a Happy New Year in 2003. Pork

Payout of final paycheck after death

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