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What are the obligations of the executor of an estate?

On Behalf of | Jan 25, 2021 | Estate Planning

Many people recognize that estate administration is a really hard job, but many of them still don’t know what is actually involved. Whether you are currently planning your estate or a loved one asked you to serve as the executor for their estate, knowing the responsibilities of estate administration will help you make better decisions and protect yourself.

As a testator, understanding the obligations of an executor can help you pick the right person. As an executor, knowing the responsibilities you must fulfill can help you avoid mistakes that could cost you money.

An executor must secure and quantify all assets

One of your first steps as executor will be to secure the property of the deceased and create an inventory that thoroughly accounts for all of their property. From the outstanding balance for their utility accounts to the value of their fine art or jewelry collection, it falls on you to make sure that you know what they have and what it is worth.

You also need to make sure that you secure the property so that opportunistic family members or strangers who hear about the death don’t try to steal from the estate. In some cases, changing the lock on a house no longer occupied is necessary. Other times, moving valuable assets to a new location will be the best approach.

Executors must notify the courts and creditors about the death

Most large estates will have to go through probate court. Even if there aren’t a lot of assets, you may still have to involve the courts if there are substantial debts.

You will also need to reach out to those who own debts payable by the deceased party. Determining the amount of debts is crucial because you have to pay them out of the estate or possibly become responsible for them if they go unpaid and you distribute assets to others.

You have to settle the tax obligations of the deceased as well

Even if the testator was not filing income taxes when they died, you will still have to file one after they pass. The estate itself may also need to pay taxes in some situations.

Once obligations are met, you can distribute assets to heirs

Only after you have repaid debts and handled all other outstanding financial concerns can you begin to distribute property to the beneficiaries of the estate. When you do so, documenting who received what and having receipts and paperwork accompany the distribution can help protect you from claims that you handled things inappropriately or didn’t give property to the appropriate parties.

Getting support as an executor can help you fulfill your obligations and make it easier for you to avoid common legal pitfalls during this complex process.