Mark Reckman - The Afterlife of Your Frequent Flyer Miles

THE AFTERLIFE OF YOUR FREQUENT FLYER MILES  In a normal year, Americans rack up about 3 trillion frequent flyer miles. The average is about $622 per household per year. And travel experts are predicting that travel this year will exceed all previous years. What happens to those frequent flyer miles when we die?Many airlines allow you to give your miles to your heirs – so do many hotel reward programs. There is often a fee - $50 - $100.Neat idea – but also a pain in the neck – probably worthwhile but a pain nonetheless.  How does it work?You can do it in a Will. You can be specific or it will pass as a part of your residual estate. You can do it in a Trust.You can do it in a beneficiary designation specific to those loyalty points.To make the claim: Have a death certificate. Have the regular address and email address of the deceased. Have the account number and password of the deceased. Have your own account number and password.Have the transfer documentation (assignment, Will or Trust)  Then contact the airline – probably by phone – and be patient.  Some airlines (Delta and American Airlines) will send you a packet to fill out. Some airlines (Southwest) simply do not allow transfers. Loyalty points are part of your taxable estate – so they should go on your estate tax return – if you file one. The hardest part is how to pick a value for them. I have never seen loyalty points on an inventory or on an estate tax return. The IRS has not adopted an enforcement plan relative to FFM.Don’t take the first “No” as an answer – try again.Tips to make things easy: Make a list of all your frequent flyer accounts and put it with your Will.  Sign a document that says “When I die, I leave my frequent flyer miles in Delta Airlines Acct. #                                              to my wife, Jane Doe.  Transfer those miles to your own account, if the plan allows. It is best to do that before death. But, you can log on as the deceased and do it that way – if you know the account number and password (and other security info).  Some plans allow the owner to buy tickets for others. You can long on as the deceased and buy a ticket for yourself.