What are the Responsibilities of an Executor of an Estate?
The executor of an estate is the named party in the will that’s responsible for settling the estate of the deceased. If they’re not named in the will, or there is no last will or testament, the court will appoint an executor (also known as an administrator) to fulfill the duties and distribute the assets. The assets are then distributed according to that state’s intestacy laws since the decedent left behind no instructions or desires.
Intestacy laws are used when someone dies without a will, they’re used to navigate the process of distributing assets and settling the estate. Each state has its own set of intestacy laws.
Is being the executor of an estate difficult?
Executors of estate often have a large responsibility before them, and it’s not always something that the individual appointed will be prepared to take on, especially if it’s a surprise to them. Due to this, and other reasons, it’s a good idea to go over the will and your wishes with your executor directly so that they have an understanding of what’s needed. Named executors are not required to accept the role and are free to reject the offer.
It’s also worth it to start and maintain an inventory of your assets alongside your will so that your executor will have an easier time locating and distributing them when the time comes. Your inventory of assets and valuables should also include the estimated worth.
Naming an executor of an estate and not preparing them for the task can be stressful for that individual, especially if you’ve left behind a large estate without much guidance or instruction on how to navigate it. Being the executor of an estate can be difficult in circumstances where the estate is very large, there’s little guidance or information, there’s a lot of family complication and drama, or there’s not much information on the amount and value of assets.
How long does it take to settle an estate?
On average, most estates take over a year to settle. Simple, small, and clear cut estates can sometimes be resolved in around 8 months, whereas larger estates or complicated estates can take multiple years to resolve. It’s a good idea to keep this timeline in mind if you’re thinking about accepting the responsibility of the executor.
Do you get paid for being an executor?
Typically, an executor will be paid for their services either out of the estate funds or from funds set aside in the will for the executor. The decedent can also name a flat fee in the will that the executor should be paid, but this can vary depending on which state you live in. If there’s no specific funds set aside for the executor or a named fee, check with the state laws to determine what the compensation will be. Being an executor can take a lot of time and work, so executors are usually entitled to compensation.
What does an executor of a will do?
The executor of a will has many responsibilities, especially if the estate they’re settling is a large one. This is one of the reasons it’s a good idea to have as much information available to your chosen executor as possible. Providing clear and organized information for them to reference can reduce the amount of time they might spend looking for people, assets, paperwork, and other information. Here are some of the responsibilities you can expect to take care of as the executor of a will.
Find and file documents.
You will need to file the death certificate and the will with the local probate court. You’ll likely need the original will and not a copy of the will, so if you’re having difficulty finding the original, you’ll want to meet with the lawyer who helped draft the original will. These documents need to be filed with the probate court even if the will is not going through probate and should be filed within a few days of the death, but most states will allow up to 90 days to file these documents.
Apply for probate with the probate court.
File a petition with the probate court and provide any required documents needed to begin the probate process. Even if there is a will, you’ll likely still be required to apply for probate and will be asked to submit the will for verification and authentication.
Notify others of the death.
Notifying others of a death. includes family, friends, beneficiaries, government agencies, companies, and a lot more. It’s useful to have a checklist of people and organizations you need to notify, such as this one. Here are some of the individuals and organizations you’d need to contact. Please note this list is not exhaustive:
- Beneficiaries & heirs
- Social Security Administration
- Insurance companies
- Banks and financial institutions
- Department of Veterans Affairs
- Post office
- Pension providers
- Department of Motor Vehicles
- Credit reporting agencies
You can use Ever Loved to easily notify friends and family of a death by creating a memorial website for the deceased. The memorial website will show up in search engines so that anyone looking for the person can easily get in touch. You can also directly share the memorial website with friends, family, and your community and ask that they share it with as many people as possible. Once shared, people can visit the website, post memories and condolences, view event information, and get in touch with the family directly.
Hire a probate or estate attorney.
This is not a necessary step, but it’s something that can end up saving executors headaches and/or financial liability in the future. If you’re settling a large or complex estate, or just want to ensure you’re doing everything the correct way, hiring a probate attorney is a good way to make sure you’ve checked all your boxes.
Identify and pay off decedent’s debts.
Once you notify and alert the correct agencies of a death, you’ll likely encounter creditors who will file claims. You’ll pay off any immediate debts from valid claims using the funds in the estate. You’ll also use the funds in the estate to cover any immediate funeral expenses, if available.
Tax returns and tax forms need to be filed according to the laws of the state, so you’ll need to check what your requirements are and make sure you meet the deadlines. You’ll need to file both income taxes and estate taxes, along with any other specific tax requirements required.
Locate and manage the decedent’s valuables and assets.
This step can end up taking a lot of time and effort on the part of the executor if the estate is large, unorganized and relatively undocumented. While you’re locating and managing the assets, be sure to keep a clear and detailed record of all assets and valuables. In some states, you’ll need to provide this record to the probate court at the end of the estate settling process.
Managing the decedent’s valuables and assets also involves protecting them while settling the estate. Family members and friends are not allowed to take property while the estate is being settled as it might be needed to pay off debts, might be left to someone specific, or might be needed for another purpose. Protecting the assets also might include things like managing the decedent’s rent and mortgage payments if necessary, making sure utility bills are paid, and protecting any vehicles they own.
Distribute the assets to any beneficiaries.
After taxes are paid and the valid creditor’s claims are handled, you can start distributing the assets. You don’t want to start distributing assets before taxes and debts are paid in case the estate has insufficient funds to cover outstanding taxes and debts. In some states, you might be required to file paperwork with the court and get approval before distributing the assets.
Once you’re cleared to distribute assets, it’s the executor’s responsibility to ensure all heirs and beneficiaries receive the assets left to them in the will. If there was no will, the intestacy laws in your state will have rules and guidance on distribution of the assets. Distributing the assets to beneficiaries can also sometimes require that you set up trusts for individuals or that you sell off certain property (including real estate) to ensure the beneficiary receives their inheritance.
Keep a record of asset distributions and get proof of distribution.
Estate settling is a lengthy process that can involve dealing with a lot of different people. There are also times when family drama or fractured relationships can turn an easy settling process into a difficult one. As the executor, it’s a very good idea to keep a detailed, consistent, and accurate record of all of your actions when distributing the assets. As stated above, some states even require you keep a detailed record of all financial transactions and distributions. To further protect yourself, it’s a good idea to get receipts for all of your distributions or proof that you’ve distributed the assets to their rightful heirs.
File a petition to close the estate with the probate court.
Once you’ve finished distributing the assets and covered all of the debts and taxes, you’ll need to create a final accounting of all of your actions. Have the final accounting reviewed by the beneficiaries before submitting it to the court for approval. (It might also be worth sharing this with your lawyer for approval before submitting it to the court, if you have one.) After submitting the final accounting, you’ll need to file a petition with the court to close the estate. Once the estate is closed, your responsibilities as the executor have been fulfilled!
Is the executor responsible for covering debts if the estate is insolvent?
If there is not enough money to cover debts and taxes, or the debt left behind exceeds the assets, the estate is considered insolvent. The executor of the estate is not responsible for covering these debts simply because they are the executor. If any of the debts had a co-signer, those debts usually fall to the co-signer. Otherwise, the debts will need to be paid according to a specific priority order. You should go to your probate court or probate attorney for more guidance on the order in which creditors need to be paid.
It is important to note that even if the estate is insolvent, the executor still needs to handle the estate. If funds are mismanaged, distributed incorrectly or creditors are not paid in the right priority, the executor of the estate can be personally liable. In some states, you’ll be required to file an insolvency administration order with the court before the executor can start distributing the assets to the right creditors.
The job of the executor of an estate is very involved and can take a very long time to complete. It requires patience, organization, communication, and the ability to keep track of and meet deadlines. While you are generally compensated for your work as the executor, it can also open you up to frustration from family members or any involved in the decedent’s estate. This can also be a difficult job to do while grieving the loss of a loved one, so it’s important to understand the responsibilities before accepting and jumping in.