What Does It Mean to Be an Executor in Probate? Executor Checklist:
In Probate matters an Executor is an individual responsible for managing the affairs of a decedent’s estate. When a person dies, they can no longer own property. Everything owned at the time of death must be legally transferred to any beneficiaries still living. An Executor appointed to administer the estate of the deceased will be responsible for transferring the assets of the estate to the living beneficiaries. The Executor’s main duty is to carry out the instructions in the will and to manage the affairs and wishes of the deceased person’s estate.
In addition to many other duties, an Executor is responsible for the following:
- Obtaining a copy of the Death Certificate;
- Locating the Will
- Lodging the Will in Probate court;
- Petitioning the Court to become the Executor of the Estate
- Identifying all assets, accounts, debts, and liabilities to manage distribution and taking an inventory and appraisal of all assets and liability of the Estate;
- Setting up an estate account;
- Putting all potential creditors of the decedent on notice of the death of the decedent and informing them of their rights to seek payment of the decedent’s death from the Estate.
- Keeping accurate records;
- Paying legal debts and expenses;
- Filing tax returns for the decedent; and
- Asking the Probate Court for approval of all of your actions and permission to the distribute the remaining assets pursuant to the Will or by the rules of intestate succession.
Although an Executor has many responsibilities to uphold, there are limits on what an Executor can and cannot do. If you’ve been named an Executor, some rules to be followed are that you cannot do anything that disregards the provisions in the decedent’s will. As an Executor, you will have a fiduciary duty to the beneficiaries of the estate. What this means is that you must manage the estate assets as if you were a scrupulous banker. In your role as an Executor, taking care of the assets is of the utmost importance. Therefore, you cannot do anything that intentionally harms the interests of the beneficiaries.
Mismanaging an estate is not without consequences. If an heir or beneficiary believes you are not appropriately fulfilling your legal obligations, they have the right to file a Petition with the Probate court to get a full accounting of the estate’s assets or to have you removed as the Executor. If the Court determines that you did something wrong, you could be personally liable to pay money back to the Estate. This is why it is so important to locate and take a full inventory of all assets, accounts, debts, and liabilities of the estate so that the estate is managed properly.
An Executor can be a spouse, adult child, a legally-appointed friend or relative, or a Trust company named by the decedent in their Will or Trust. There are a number of steps to take when managing a decedent’s finances. Knowing what to expect in advance can make the transition easier. Retaining an Estate Attorney can make the job much less daunting and can aid in pointing the tasks in the right direction. Below is a checklist to follow when you become an Executor of an estate in a Probate matter:
Step 1 – Identify and take a full inventory of all estate assets.
- This will assist in determining whether a formal court-supervised Probate is a necessary step in the process;
- The size of the estate will determine if Probate is necessary;
- If no formal Probate is necessary, transferring of all assets held in Trust; IRAs, bank accounts and real property to the appropriate parties;
- If Probate is necessary, proceed to Step 2.
Step 2 – Lodge the Will in Probate Court.
- The decedent’s Will needs to be lodged in the Probate court with jurisdiction over the estate;
- Petition the Probate Court to be named as the Personal Representative (Executor or Administrator) of the estate;
- Once the Order for Probate has been granted, request certified Letters of Administration from the court clerk;
Step 3 – Locate and manage all estate assets.
- Locate all of the estate assets and manage them carefully and prudently;
- The timeline for this process can take approximately 1 year from the date of death of the decedent or longer; therefore, being patient is key.
Step 4 – Establish a bank account for the financial holdings of the estate.
- This is important because if there are still financials owed to the decedent there will be an account to deposit them into. i.e.: stock dividends;
- This will also be important for paying debts still owed by the decedent at time of death, or that the estate is legally obligated to pay.
Step 5 – Notify Creditors.
- If there are any outstanding debts owed by the decedent that are unknown this is when creditors come forward to inform the Personal Representative that the decedent owed the creditor money;
- Once Notice to Creditors has been sent, creditors will have either four months from the time the Letters were issued or 60 days after the date the notice to creditors was mailed to the creditor inviting them to file a creditor’s claim for payment.
Step 6 – Distribute assets, gifts and cash disbursements to all named beneficiaries.
- File a petition with the Probate court for permission to distribute the estate assets and cash on hand to the beneficiaries named in the Will, (or if no Will, then to the relatives entitled to their inheritance under the law);
- Once the probate court grants the petition for distribution, you will be responsible for distributing the correct estate assets to the correct beneficiaries and getting receipts from the beneficiaries.
Step 7 – File a tax return and pay all unpaid final fees
- File a final income tax return for the decedent, and for the estate if necessary;
- Pay estate taxes if it is required;
- Pay any outstanding final fees and costs.
Step 8 – Close the estate.
- Maintain, organize, and file all necessary records, including receipts and evidence of disbursements;
- Close the estate bank account after all payments are made and checks have cleared; and
- Petition for release and final discharge as Personal Representative of the Estate from the probate court.
The views expressed in this article do not contain legal advice, may not be current and is subject to change without notice. The information contained herein is provided for general information and educational purposes only and is not a substitute for professional advice. Should you need legal advice, contact Simon Law directly and request to speak to an attorney regarding your case.