Probate is the process of administering and settling an estate after a person dies.Read more
What Is Required of an Executor?
- August 7th, 2023
Being the executor of an estate is not a task to take lightly. The time and effort involved will vary with the size of the estate. Even if you are the executor of a small estate, you will have important duties that you must perform correctly.
What Is an Executor?
An executor is the person responsible for managing the administration of the estate of someone who has passed away. As an executor of an estate, you may be liable to the estate or those who will inherit the deceased’s assets.
The executor is either named in the will or, if there is no will, appointed by the court. Even if the will names you as executor, you do not necessarily have to accept the position.
Estate Administration: The Duties of the Executor
The average estate administration takes one year. However, you will not need to work full time on it in your role as an executor.
The following are some of the duties you may have to perform as executor:
- Locate the estate documents. You may need to find the will among the deceased’s belongings. If you only have a copy of it, you may need to obtain the original from the lawyer who drafted it.
You will also need to get a copy of the death certificate.
- Consider hiring an attorney for assistance. It is not a requirement that you hire an estate planning attorney. However, keep in mind that any mistakes you make can cost you money. You may be personally liable if something goes wrong with the estate or the payment of taxes.
A qualified estate planning attorney can help ensure that you are taking all of the proper steps and meeting all deadlines.
- File an application for probate. If there is a will, the court will grant you a letter of testamentary. This officially give you power to serve as the executor of the deceased person's estate.
If there is no will, you will receive letters of administration. This will officially begin your work as the executor.
- Be sure to notify any interested parties. As executor, you are responsible for notifying the beneficiaries of the will, if there is a will. You also must contact any potential heirs. This could include children, siblings, or parents (who may or may not be named in a will).
In addition, you will have to place an advertisement for potential creditors in a newspaper near where the deceased lived.
- Manage the deceased’s property. You will need to prepare a list of the deceased’s assets and liabilities. You also may need to collect any property in the hands of other people.
One of the executor’s jobs is to protect the property from loss. It is your responsibility to keep the property of the deceased person safe. You will also need to hire an appraiser to find out how much any property is worth.
In addition, if the estate includes a business, you may have to make sure the business continues to run.
- Pay valid claims by creditors. Once the creditors are determined, you will need to pay the deceased’s debts from the estate’s funds.
The executor is not personally liable for deceased’s debts. The estate usually pays any reasonable funeral expenses first. Other debts include probate and administration fees and taxes as well as any valid claims filed by creditors.
- File the required tax returns on time. Make sure to file all tax forms within the timeframe set under the law. Taxes will include estate taxes and income taxes.
- Distribute the assets to the beneficiaries. Once the creditors’ claims are clear, the executor must make sure the beneficiaries get what they are entitled to under the will or under the law, if there is no will.
You may need to sell property in order to fulfill legacies in a will. In addition, you may have to set up any trusts required by the will.
- Be meticulous about keeping accurate records. It is very important to keep accurate records of everything you do. You will need to create a final accounting, which the beneficiaries must review before the distribution of the estate can be finalized. The accounting should include any distributions and expenses as well as any income earned by the estate since the deceased died.
- File the final accounting with the court. File the final accounting report with the court. Once the beneficiaries and the court approve the final accounting, the court will close the estate.
Can an Executor Receive Compensation?
Clearly, all of these tasks can be a great deal of work. However, remember that the executor is eligible for compensation, subject to approval by the court. Also keep in mind that any compensation you receive counts as income. So, you will need to declare it on your income taxes.
Contact an Estate Planning Professional for Guidance
The tasks an executor must complete may prove time-consuming or daunting if you have never served in this role before. Consider connecting with a qualified estate planning attorney to help you understand and carry out your duties as an executor. Estate planning attorneys will be familiar with the laws in place that are in the state where the deceased had lived.
Created date: 08/20/2007