There is a lot you should know about the estate administration process especially if you will serve as an executor for a loved one’s estate. This article will share with you some of the most important things an executor should know. When a loved one asks you to serve as an executor of an estate, chances are that your first thought isn’t about all the work that job requires. If you’re like most people, there’s an initial rush of satisfaction and a feeling that you’ve just been given an incredible honor.
Understanding the executor’s responsibilities
In your role as an executor, you are charged with the responsibility of overseeing the probate process that will settle your loved one’s estate. In some instances, this will involve relatively little work – especially when the decedent’s estate is straightforward and lacking in complexity. In other instances, it could be a long, drawn-out affair that involves many assets, a stream of creditor claims, and even disgruntled heirs. Usually, it’s something between those two extremes.
As an Executor You Must Serve as a Fiduciary
Executors have multiple duties that must be fulfilled. These include a duty to take possession of and protect the decedent’s assets. You also have a duty to ensure that creditors are properly reimbursed for all valid debts. There’s a fiduciary duty to the heirs as well since it is your job to faithfully protect their interests in the estate, even as you’re paying debts and taxes as part of the probate process. You also owe a duty to the probate court, providing it with timely accountings and reports so that it can fulfill its supervisory responsibilities.
Basic Tasks Most Executors are Expected to Perform
There are a number of specific tasks that must be performed during the probate process. These tasks include presenting the will to the probate court so that the court can accept you as executor and appoint you to serve in that role; locating assets and protecting them so that they can be used to pay debts and fulfill the terms of the decedent’s will; evaluating the estate to determine which property needs to be probated and what can be passed on through other means (beneficiary designations, joint ownership, trust, etc.).
Smaller estates may not require probate at all. Identifying beneficiaries listed in the will and notifying creditors will be required. Those creditors have a right to file claims against the estate for any debts the decedent owed. You’ll have to evaluate those claims so that you can pay all valid debts, using the assets left behind by the decedent. In some instances, you’ll need to liquidate assets to free up capital that can be used to pay those debts.
Determining any taxes owed by the estate, and ensuring that they are paid in a timely manner is another responsibility. You’ll need to file the decedent’s last state and federal tax returns, and may have to deal with estate tax issues if the estate is of sufficient size. Giving a final accounting to the court so that it can order the release of inheritances is also required. When that is accomplished, the court will formally close the decedent’s estate, and your work will be complete.
It is Acceptable to Seek Assistance From Other Professionals
Don’t forget that asset appraisals, accounting, tax preparation, and even legal assistance from an attorney are all services that you’re entitled to retain – at the estate’s expense. And while you might not need that help for smaller estates, you shouldn’t hesitate to get help with more complex cases.
Potential Liability Executors Might Face
You should also know that there can be liability attached to the job as well. For instance, if property is not properly secured and protected, it could result in a loss of estate value. If the heirs decide that your actions were responsible for those losses, they could try to hold you accountable – and even bring litigation that could place your own personal assets at risk. To prevent that, it is important to document every decision and transaction that you make, so that there is a clear record of your activities if anything is ever called into question.
Retaining an Attorney can Protect Executors From Liability
Of course, there is another way to protect yourself: retain an attorney. With a competent probate attorney by your side, you can better manage these complex issues and have the comfort that comes from knowing that your personal interests are protected. Even when you’re confident that you can manage these tasks on your own, it’s still helpful to have a professional in your corner to provide that extra layer of protection.
Join us for a FREE seminar today! If you have questions regarding the duties of an executor or any other probate matters, please contact the experienced attorneys at The Potter Law Firm for a consultation. You can contact us either online or by calling us at (704) 944-3245 (Charlotte, NC or Huntersville, NC) or for individuals in Kentucky at (606) 324-5516 (Ashland, KY) or at (859) 372-6655 (Florence, KY).