Plan for the Future

Are You an Executor of a Will? Here’s a Checklist

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You may know in the back of your mind that someday you’ll be responsible for settling an estate of a parent, spouse, sibling or other loved one. But what does it mean to be named as an estate executor (or executrix, if you’re a woman)? What will you be responsible for doing either on your own or with professionals? Here is a general summary of the major responsibilities of an estate executor — also known as a personal representative.

Gather important documents.

A lot of your initial tasks as an executor will be about getting organized and collecting paperwork. Compile all existing estate documents such as wills, trust(s) and powers of attorney. You'll also need to inventory all assets of the deceased person (also referred to as a decedent) through bank statements, insurance policies, credit card accounts and retirement and mortgage statement — as well as personal effects.

Communicate.

You’ll play an important part in keeping consistent lines of communication open throughout the process with any potential heirs and fiduciaries, who are people the deceased has given power to act on his or her behalf in certain areas (e.g., guardians, trustees and power of attorneys).

Ensure estate fiduciaries have formal authority to act.

In most cases, estate fiduciaries need to obtain formal authority to act. Typically, the fiduciary will file the applications and supporting documents required by local law with the proper court and then receive letters or orders from the court. The formal grant of authority then allows the estate fiduciaries to demand turnover of assets and to act in the same capacity as the decedent could have.

Open an estate account.

This can be a convenient, effective way to hold estate assets (including paychecks and paid dividends owed to the deceased) and pay the bills, debts and taxes associated with the estate. As part of this process, make sure you keep an eye on fees and other charges.

Handle day-to-day affairs.

This may involve tasks like cancelling credit cards and notifying credit bureaus, banks and government agencies of the death.

Resolve disputes and settle claims.

If anyone disputes the will or businesses pursue debt the deceased owed, you'll resolve the matter in probate court. You will have to pay all valid claims from the estate in the order of priority set by state law. You'll also decide whether to pursue any claims the deceased had against others.

Pay debts.

Any unpaid bills and ongoing contracts will need to be reviewed and either paid, compromised or rejected. If someone with a rejected claim persists in seeking payment, an application may be filed in the probate court and the estate fiduciaries can oppose them.

Pay taxes.

All applicable tax claims must be resolved before the estate is considered “closed.” Tax liabilities can include state or federal tax returns for the last year of the decedent’s life, as well as the decedent’s tax liability for enforceable taxes from prior years. The estate itself might have tax liability for income earned during the period of estate administration.

Some states may also impose a tax on the money or other assets (“inheritance”) people (“beneficiaries”) receive from the estate. This is known as an inheritance tax. Prior to the beneficiary receiving the inheritance, the estate fiduciaries will calculate and deduct the amount of the tax owed from the beneficiary’s inheritance.

Distribute inheritances.

Typically distributions are made after the estate’s taxes, debts and other liabilities are paid. In some instances, distributions include a specific piece of real estate or item of personal property; however, if the distribution is as a share of a common fund the fiduciary may have to sell some assets in order to have enough cash to create the fund.

Keep accurate records of everything.

Final accounting of the estate is filed with the court. You may be required to send copies of the accounting to beneficiaries and creditors. The court has to approve the final accounting before assets can be distributed.

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