The executor is legally responsible for managing the deceased`s finances, usually ensuring that debts and taxes are paid and that what is left is properly distributed to the heirs. The law does not require an appointed executor or administrator to be a legal or financial expert, but it does require the highest level of honesty, impartiality and diligence on the part of that person. This liability is called a fiduciary duty – the legal duty to act only in the best interests of others. It is important to have a lawyer available if you have a legal question. A lawyer from LegalZoom Personal Legal Plan is ready to help you if needed. You can move forward with confidence, knowing you have the legal advice you need. Learn about personal legal information now. Since inheritance laws may facilitate the transfer of certain assets without inheritance (for example, property held jointly by a husband and wife), an estate is not always necessary. In addition, the value of the estate can allow for an expedited process. If an estate is required, you must file an application with the court to be appointed as executor.
You`ll probably need the help of a lawyer to make this happen. The proper administration of an estate requires the executor or administrator to make many strategic decisions in a timely manner, both tax and otherwise. Meticulous attention to detail and the fulfillment of estate obligations are essential to successfully fulfilling fiduciary duties to the estate and estate beneficiaries. If the value of the estate`s assets is relatively modest, or if most of it is without estate, the estate may be eligible for small probate or informal probate procedures. If all owners of an estate are eligible for a transfer outside the estate, an estate case is not required. Small probate procedures or avoiding the estate altogether can save the estate money and the executor time. The executor is responsible for inventorying and valuing the assets of an estate so that they can distribute them properly. The performer should organize a spreadsheet that lists all assets and their value. The final inventory can be filed with probate court, and many probate courts offer inventory worksheets. To value assets, an executor may hire professionals such as appraisers, especially if the assets are complex. The inventory and valuation should also include all debts of the estate.
In consultation with the appropriate professionals, if necessary to determine the legality of a bill of exchange or debt, the executor is responsible for paying bills and debts owed by the deceased from funds found in the estate. An executor is also responsible for ensuring that income tax and estate tax returns are prepared and filed by the appropriate professional. You have learned a lot as an executor. You have established valuable contacts with experts. You`ve seen what kind of things you want to incorporate for yourself and the things you want to avoid. Now is the time to put this knowledge to good use and plan your own succession. Since estates vary greatly in size and complexity, and the work of the executor can be easy or difficult to accomplish, the responsibilities may well go beyond the 10 basic items on this list. But while an executor can refuse or resign from the position at any point in the process, sometimes only legal advice is required.
Consultation with a lawyer is usually used to ensure that the executor is properly performing his or her duties. If there is no valid will at the time of death, the estate and property are distributed on the basis of the legal succession of the state in which the property is located. This process is called estate administration and the person is called the administrator. When a person dies, all of the deceased`s property becomes part of their estate. It must then be administered according to the will of the deceased. The person named in a will for the administration of the estate is the „executor“. Illustration. The deceased died on May 15 of the 1st year. The taxation year of the sole beneficiary of the estate is the calendar year. By choosing a fiscal year ending January 31, the executor ensures that all income distributed in Year 1 is not included in the beneficiary`s income until Year 2. This allows you to postpone the effective date on which the tax is due. A bond is issued by a guarantee company and protects against the possibility that the executor or administrator will not distribute the assets of the estate to the person or persons who are entitled to do so.
The cost of the bond depends on the size of the estate and can be several thousand dollars or more. Most wills waive the bail requirement because of the cost of the estate, and trusted family members are usually appointed as executors. However, most surrogates require an administrator to leave a link in all cases, unless the administrator is the surviving spouse. Sometimes the executor has to decide when to sell the property so that the heirs receive a reasonable return. You may also be asked to initiate and defend legal proceedings on behalf of the property and the deceased. The legal process to ensure that property is distributed to living relatives and that any taxes or obligations are paid is called an estate. Acting as the executor of a loved one`s estate is a heavy responsibility. This requires careful organization and compliance with legal requirements. The executor has a fiduciary duty to act in the best interests of the estate and its beneficiaries. They may be held legally liable if they fail to comply with this obligation, for example if they act in their own interests or if they allow the assets of the estate to be extinguished. Plus, you probably want to make sure your loved one`s wishes are respected and carried out. This section explains the steps you can take to perform your duties as an executor effectively and efficiently.
Before you agree to act as an executor, you need to understand some of the dangers that can result. And know how to deal with some of these potential dangers so that the executor`s activity can run smoothly. This includes maintaining a home until it is distributed or sold to heirs – even deciding whether the property should be sold. In addition, the executor must ensure that all personal effects in the estate are found and protected until they are distributed. If the deceased had a safe, the executor must locate it and keep it in a safe place. Choice of portability. Under the Federal Tax Code, if the estate of a single or married testator is less than the maximum allowance under federal law that triggers the filing of a federal estate tax return, the executor may retain the unused exclusion amount for the surviving spouse. Tax law provides for an election as to the estate of any deceased person who was a resident or citizen of the United States at the time of death and who is survived by a spouse.
The executor must make this choice in the inheritance tax statement. Another option is to proceed without a will in accordance with intestate succession laws. When a person dies without a will, New Jersey law determines who has the right to serve as administrator (the equivalent of an executor) and who is entitled to receive estate assets (assets that would have passed through the will as rightful heirs). There are advantages and disadvantages to this approach. But it`s not a job to worry about either. The probate process is well established and overseen by the probate court. An executor receives instructions from the court and may seek legal advice and professional help from an estate lawyer. When valuing assets, determining beneficiaries` interests in personal property, and paying debts, the next thing to do is to allocate estate assets in accordance with the will.