Are you choosing an executor of your will, or have you been appointed as one? Either way, you may be wondering what an executor is and what their responsibilities are. An executor of a will is responsible for fulfilling the last will’s instructions.
Who Is an Executor?
If you check the legal dictionary, you will find the following definition: an executor of a will is the person appointed to administer the estate of a person who has died leaving a will (the testator) that nominates that person.
Simply put, an executor becomes your personal representative after your death and ensures that your last wishes are duly carried out. Executors manage financial assets, distribute the estate among the beneficiaries, and settle debts and bills.
All in all, this person completes all the matters that you describe in your last will and testament and would like to be completed after your death. Therefore, appointing a trusted and reliable executor is one of the essential tasks when creating the final will and testament.
What Are Executors of Last Wills Responsible For?
Whether you need to choose a personal representative or prepare to be one, you need to understand the scope of responsibilities. The duties may be comparatively easy or challenging depending on the estate complexity and number of executors. However, every executor should be ready to do the following:
1. Make funeral arrangements
A last will often includes funeral preferences of the deceased, and it is the executor’s first responsibility to carry them out. These preferences may include funeral or memorial service, burial type, and cemetery information.
2. File the last will
The next essential task executors should do is file an original will with the local probate court. By filing the will, the estate executor confirms that they are the appointed representative and starts the probate process.
3. Inform others about the person’s death
Executors of a will must notify all relevant financial institutions, employers, Social Security Administration, Veterans Affairs, and other government agencies about the person’s death. This step should be done as soon as possible since it starts the process of entitling death benefits, such as life insurance payments, to the beneficiaries.
4. Pay estate’s bills, debts, and taxes
Another legal responsibility of an executor is to pay all the estate taxes, debts, and ongoing bills. These are paid from the estate funds or a joint bank account created by the testator before their death.
5. File income tax return
Another legal duty executors perform is filing income tax returns. The executors have to file the final income tax return by reporting the income generated from the beginning of the tax year up until the decedent’s death.
6. Distribute assets among the beneficiaries
The final executor’s obligation is to distribute the deceased person’s property and assets among the beneficiaries. The distribution can only occur after all the debts and bills are paid and the estate is evaluated. Some estate, specifically which is considered small, may be distributed through a simplified or streamlined probate process using a small estate affidavit.
Who Can Be an Executor of a Will?
Generally, there are no restrictions on who can be an executor of a will. As a rule, two requirements must be met: this person must be 18 years old and reside in the state where the will is created. So, you are free to appoint anyone you consider suitable for the role as long as they comply with the abovementioned requirements.
Note that it’s possible to appoint several executors to act at the same time, but it’s not recommended if you’re not sure if they can cooperate well. You can also indicate alternative executors if the original ones decline the positions or are no longer capable of fulfilling their duties. The probate court always approves the testator’s choice if there are no significant objections. The court only takes responsibility to designate an administrator (court executor) if there is no will.
How Do You Choose Your Executor?
So how to choose a trusted and reliable executor? You can have several people on your mind, and all of them may seem to fit the role perfectly. However, it’s recommended to look at the matter from different sides and consider the following factors:
- Whether the person wants to be the executor: You are recommended to explain to the chosen individual that you will designate them as your representative after death and discuss whether they are OK with it. You need to be sure that this person is willing to be your executor. Since this role is time and energy-consuming, not everyone may want to accept the responsibilities.
- What your relationships with this person are: Of course, it’s better to choose the person with whom you have good relationships, for example, your spouse, close family members, or friends. Choosing a significant other as a representative will ensure that the decedent’s wishes are executed accurately. Do not forget to consider the age of the potential executor—this person should still be alive when you pass away.
- Communication and organization skills. Apart from good relationships, you need to ensure that the potential executor has strong communication and organizational skills. As an executor, this person will have to communicate with different financial institutions and insurance companies and manage their time accordingly. So, they must be disciplined, well-organized, and communicative.
- Place of residence. Another factor to bear in mind is where the person lives. It would be much more convenient if they lived close to you. First, it will be easier for them to file your will, appear in court, and distribute your estate. Secondly, they will be more likely to be acquainted with applicable state law.
Five Things to Consider Before Becoming an Executor
If you’ve been chosen as the will’s administrator, you’ve been awarded great power. Being an executor is an honor, but we all know that with great power comes great responsibility. The individual who appointed you as the executor might have informed you about their plans, and you might have already agreed to play this part. But think again, are you ready to accept this role?
Maybe you accepted the proposition just because you didn’t want to spoil the relationship. If so, it’s better to let someone else handle these duties. It may seem disrespectful towards the deceased person, but failing to execute their last wishes is worse. While you are thinking about all the pros and cons, do not forget to consider the following points.
1. Time commitment
Being an executor is time-consuming. You will have to notify different institutions about the person’s death, determine the estate’s beneficiaries, distribute the person’s assets, pay the estate debts and utility bills (if any), appear in probate court multiple times, file final income taxes, and deal with a large amount of paperwork in general. Do not forget that these duties may come on top of your other daily tasks.
2. Estate complexity
The larger the estate, the more difficult it is for the executor to handle and distribute it. The decedent may leave real estate, several bank accounts, valuable personal property, and a few cars after their death. Of course, the individuals with such an estate tend to hire a probate attorney and other professionals to help their executors in the future. But if there are no professionals to assist you, you need to think twice before accepting the executor’s role.
3. Personal liability
Executors can be held liable for any mistake they make related to managing and distributing assets. State law protects executors from the decedent’s estate liabilities, but an executor will be legally responsible for the damages caused by their negligence or breach of duty.
4. Disputes
If there are several co-executors, disputes may arise, especially if the executors are siblings or family members. These disputes may be connected to time arrangements since it can be hard to gather everyone around, for example, to sign documents. Furthermore, as the deceased’s representative, you may face conflicts with heirs who decide to challenge the will if they are not indicated as beneficiaries.
5. Compensation
As a rule, an executor is paid for their job because they tend to quit their main employment to fulfill the executor’s duties. However, sometimes executors are asked to waive any compensation due to small estate worth.
You should remember that you are not obliged to be an executor. If you feel that you cannot handle the duties and responsibilities appropriately, you are free to decline the position. However, you have to do it before carrying out any of the executor’s duties. Otherwise, you will be considered intermeddling and have to continue acting as the executor.
Final Thoughts
Being an executor may be challenging. This role involves considerable time commitment and effort. However, if the testator prepares everything in advance, it would facilitate the task for executors, estate planning professionals, and probate court. A well-written will, a joint bank account for potential executor’s expenses, and hired estate professionals will ensure that the executor’s job will be performed at the highest level.