If you have been chosen to serve as executor of a loved one's estate, you may find yourself honored. However, you may also feel confused if you are uncertain what exactly being an executor entails. Being named the executor of an individual's estate is both a privilege and a burden as there is a great deal of work that comes with being an executor. Broadly speaking, an executor oversees the handling of the final affairs of a deceased individual including paying off their debts and distributing their assets in accordance with their will.
While the law does not require an executor to be a legal or financial expert, this position comes with a great deal of responsibility. An executor has a fiduciary duty to act in an honest, impartial, and scrupulous manner on another's behalf. It is then important that you truly understand what you are agreeing to take on before deciding whether or not to act as a loved one's executor. Take some time to research what an executor does and what exactly you will be getting yourself into before you make such an important decision. To help get you started, here is a look at answers to the most frequently asked questions we receive about what it means to be an executor.
What Is an Executor?
If you are unfamiliar with the term, you may first find yourself wondering what an executor is. The executor (also called a personal representative in some states) is a person named in a will or appointed by the court who is given the legal responsibility of taking care of a deceased person's remaining financial obligations. This generally includes taking care of the property, paying debts and taxes, and ensuring that assets are transferred to their new owners. If probate is required, it will also be the executor's responsibility to oversee the probate process or hire a lawyer to do so. Most executors are immediate family members, with spouses, children, parents, and siblings being common choices.
How Is an Executor Appointed?
An executor is typically named in the will by the testator. If a deceased individual had no will, the court will appoint an executor, and the assets within the estate will be distributed according to the state's intestacy laws. Many times, an individual will also name secondary executors in their will in case their preferred executor is unavailable, or unable, to serve at the time of their death.
Who Can Be an Executor?
As we previously mentioned, executors are most commonly close family members, and they are often beneficiaries of the will; however, this is not always the case. When choosing to name an executor in their will, some people prefer to choose someone not named in the will, such as a family friend, as they may be more neutral when fulfilling their role as executor. Of course, every state has legal requirements regarding who can execute a person's will. Most states require that an executor be at least 18 years of age, but some states require an executor to be 19 (Alabama and Alaska) or even 21 (Utah). Some state laws also require an executor to be a resident in the same state as the deceased.
Does an Executor Have to Serve?
While it is an honor to be named an executor in someone's will, it can also be an overwhelming prospect to be faced with. Whether you do not believe that you are qualified to serve, or you simply do not have the time to take on such a large responsibility at the moment, you may find yourself wondering whether you have to serve if you have been named executor in someone's will. Fortunately, you do not have to serve as executor if you do not feel up to the task.
When the time comes, an executor will be given the opportunity to accept or decline this responsibility. Furthermore, should you agree to serve as executor and realize that you are in over your head, you also have the right to resign your role as executor at any time. Should you refuse, or resign from, the position of executor, any alternative executors named in the will will take over. If no alternative was named, the court will appoint someone else to step in.
What Does an Executor Do?
As the legal representative of the estate, the executor has many duties and responsibilities that they must fulfill when taking care of the deceased's affairs. If you have been chosen as executor in a loved one's will and are unsure what your job will entail, here is a look at just a few of the responsibilities of an executor.
Determine Whether Probate Court Proceedings Are Necessary
One of the first duties of an executor will be determining whether or not the estate will need to go through probate court. While many estates that have a will and no trust will have to go through probate, there are exceptions. For instance, most jointly owned assets can pass to the surviving owner without probate. Furthermore, depending on state law, assets worth less than a certain amount of money may be able to go through a streamlined probate process rather than traditional probate court proceedings.
File The Will With the Local Probate Court
Next, it is critical that the executor gets a copy of the will and, after ensuring that they have read its contents, file a copy of the will with the local probate court. Even if formal probate proceedings won't be necessary, it is still usually required for a copy of the will to be sent to probate court. It is at this point that the executor should also start to determine who the estate's beneficiaries will be and how the estate will be divided.
Notify Others
It is also the executor's responsibility to ensure that others are made aware of the death of the testator. While this will include family and friends, it is particularly important that the executor contacts financial institutions and government agencies as well. This includes:
- Insurance Companies
- Banks and Credit Unions
- The Social Security Administration
- The Department of Veterans Affairs
- Medicare
- The Post Office
You will also need to ensure that all of the estate's beneficiaries have been made aware of the decedent's passing.
Set Up an Estate Bank Account
In the period immediately following the death of the decedent, there may be ongoing bills that need to be paid, or final paychecks that need to be received. It is then important that the executor sets up a bank account to handle these transactions. In particular, the executor needs to look out for and pay utility bills, mortgage payments, and homeowner's insurance until the estate has been settled.
Supervise the Distribution of Assets
Of course, one of the primary roles served by an executor is supervising the distribution of the deceased person's assets. The executor has a responsibility to distribute property in accordance with the will and/or as directed by probate court proceedings.
Does an Executor Get Paid?
Many people who serve as an executor choose not to receive compensation, as they take on the position out of respect for the deceased. However, an executor is entitled to payment by law, which is understandable considering that the role of executor is a large responsibility that requires a great deal of work. The amount that an executor will be paid depends on a variety of factors such as the value of the deceased person's estate. The exact amount is regulated by state law and is decided by the probate court based on what they consider to be a reasonable amount given the circumstances. In many cases, the executor will get paid as soon as the estate's debts are paid, before its assets are distributed. However, you may be required to seek court approval or wait until probate has ended in order to receive compensation.
Should an Executor Hire an Attorney?
Upon agreeing to act as executor for a loved one's estate, you may find yourself wondering whether you are required to consult an attorney. The fact is that there is no requirement that an executor works with an attorney, and as long as you are persistent and pay attention to tedious details, you likely won't even need much legal knowledge to act as an executor. While many estates go through probate, these estates are often simple to handle and involve no disputes. In such cases, the most complicated challenge you will face will be filling out paperwork. However, there are some circumstances where executors may find it to their benefit to work with an attorney. If the estate has many types of property, significant tax liabilities, or there are disputes amongst the inheritors, you may want to consider partnering with an experienced attorney.
Of course, if you agree to act as executor following the death of a loved one and you find yourself confused or overwhelmed at any time, do not hesitate to contact a lawyer. An experienced attorney can help answer all of your questions, and they can help walk you through this difficult time.
Feel free to contact us to learn more about what being an executor entails as well as to seek advice if you have been named executor in a will.
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