A family member passed away recently - what should I do with their passport?

You can return their passport for cancellation with a copy of their death certificate to:

Customer Care,
Passport Office,
Freepost PO Box 9718,
Balbriggan,
County Dublin.

Or

For residents of Massachusetts, Maine, Vermont, New Hampshire, or Rhode Island:

The Consulate General of Ireland
Passport Section
535 Boylston Street
Boston, MA 02116

For residents of other states or countries, you may send the passport to your local Irish Consulate or Embassy.