Generally, the answer is “no,” with a few exceptions. First, I will explain what happens to your debts when you die. After that, I will cover the few exceptions to the rule for surviving spouses in Minnesota.
What happens to my debt when I die?
The answer to this question ultimately depends on how many assets you have when you die. When you die, your assets and your debts become part of an estate. Whether you have a willed estate or a probated estate, the estate consists of the assets you owned and the debts you owed at the time you passed.
The estate is assigned someone to handle its finances. Depending on the type of estate, this person is often called a personal representative or executor. Here, I will refer to them as an executor to keep things simple. The executor’s job is to transfer the assets of the deceased person’s estate pursuant to either a will or the probate laws of Minnesota if there is no will.
In the process of administering the assets, they also need to take into account the debts of the deceased person’s estate. Before they can sell, transfer, or dispose of any estate assets, they must first use the assets to pay any of the deceased person’s debts.
If you have no assets when you pass, there is no estate to administer and none of the debts get paid. If your debts exceed the value of your assets, then the executor must use what assets there are to pay as much debt as they can. The unpaid debt is then unpaid and “dies” with the deceased person. If there are more assets than debts, the assets first pay the debts and then the remaining assets are administered pursuant to the will or Minnesota probate laws.
Will my surviving spouse have to pay any of my debts?
No, your surviving spouse will not have to pay any of your debts outside of the estate process, unless they fall into one of the following narrow exceptions:
Exception 1: Co-signer/Joint Debt Obligations
If your spouse co-signed with you on a debt (think mortgage or car loan), or you were joint on a debt together (think tax debt or credit card), then you both owe the debt jointly and severally. That means you both owe the full amount as an individual. You don’t each owe half, but rather you both owe the whole thing. If one party dies, the other party still owes the whole thing because it is also their debt. This is why it is always best to avoid comingling debts and/or co-signing on anything.
Exception 2: Minnesota State Law
In Minnesota, there are two types of debts that are jointly and severally owed by spouses under state law. These debts are medical debts and “necessary household articles and supplies furnished to and used by the family.”
For medical debt, the debt is owed by both spouses is the spouses lived together and were married when one of the spouses incurred the debt. This is true both before and after the death of one spouse. Any medical debt incurred before marriage, or while not living together, would not be liable by both spouses.
For necessary household articles and supplies, the same rules apply as medical debt, but it applies to debt incurred for only household items purchased for the benefit of both spouses. If one spouse purchases something that fits into this category, but it isn’t used or consumed in the joint household, it does not fit within this exception.
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