What you need to know if you’re an executor of estate
How to fulfill your legal duties to someone's estate.
A checklist for an executor of estate
Before you begin serving as executor of estate, you should understand that most major legal and financial tasks don’t have to be handled immediately. Take a step back. Dealing with such matters at a time when you might be coping with a personal loss is difficult. In the days following death, you could be involved in helping arrange the funeral, collecting information for an obituary, contacting clergy and other urgent tasks.
When those tasks are completed, take time to get a clear understanding of the estate. And realize that you don’t have to do everything by yourself. But don’t ask other family members or friends to help. Instead, enlist the aid of three specialists: an estate attorney, your financial advisor and the deceased’s accountant. (Contact us if you need a referral to an estate attorney.) Some states let you appoint co-executors who have special expertise to serve alongside you.
It’s impossible to provide an all-inclusive checklist for executors. Each family situation is unique, and legal requirements vary from state to state. So here is a basic list to help get you started:
- Gather all the deceased’s important documents – starting with the will, if any. Ideally, the decedent would have told you where to find all the legal, tax and financial documents you need, as well as usernames and passwords for digital material. Don’t assume the decedent told you everything – look for bank safe deposit boxes, insurance policies and other items that can lead to unknown assets. Interview family members to help your search.
- File the will with the probate court. Make yourself a few copies first.
- Get several certified copies of the death certificate, typically signed by the physician who verified the death and issued by the county of residence. You’ll need one every time you must provide proof of death (although you might find that a few institutions now accept copies).
- Notify the post office, utility companies, credit card companies, banks and other businesses of the death so that recurring charges are stopped. Have the deceased’s mail forwarded to you.
- Notify the Social Security Administration, unions and any other organizations that had been providing benefits to the deceased. Payments made after the date of death will have to be returned.
- Inventory all assets and have valuable items appraised. The inventory is needed for probate court. It will also show you how assets are titled, making distributions easier, and help you determine whether estate taxes are due.
- Determine whether probate is necessary by totaling the value of property subject to probate, seeing how title is held and checking your state’s rules on what estates qualify for simplified procedures. An estate attorney can help you conduct a probate court proceeding if one is needed.
- If there’s a living trust, work with the trustee(s) to coordinate many tasks. Executors are not always the trustees, so know where your responsibilities (and rights) stop.
- Notify the heirs and beneficiaries. The estate attorney and probate court can help you. Stay in touch with them. See if the deceased’s state requires that they receive a copy of the will or trust.
- Safeguard estate assets until you distribute them. Never commingle estate assets with your own.
- Get the consent of beneficiaries before taking major steps. Otherwise, they may suspect wrongdoing. Even during a lull in activity, let them know the status. Don’t startle them with surprise announcements.
- Collect all money owed to the estate, such as the deceased’s final wages and insurance benefits. Deposit these funds in the estate bank account. (Yes, you need to create a bank account for the estate. Close the deceased’s accounts – once you’re sure that all recurring deposits and withdrawals are ended – and transfer the funds to the estate account.)
- Pay the estate’s bills in proper order. You are not obligated to pay any of the deceased’s debts personally. If you think there won’t be enough money to pay all debts, stop paying bills and ask your attorney or the court for guidance.
- File the decedent’s final income tax returns. Consider hiring the deceased’s tax preparer to help.
- If the estate exceeds $11.7 million in value, file an estate tax return. Smaller estates may owe state estate taxes. Check with your attorney.
- Distribute the assets. After all creditors are paid in full, pay remaining funds to the heirs and beneficiaries, including distribution of such items as furnishings, jewelry and other valuables.
- Congratulate yourself and breathe a sigh of relief. You’ve done a service to the deceased and their heirs.
Neither Edelman Financial Engines, a division of Financial Engines Advisors L.L.C., nor its affiliates offer tax or legal advice. Interested parties are strongly encouraged to seek advice from qualified tax and/or legal experts regarding the best options for your particular circumstances.