Executor of a Will
An executor of a will takes care of the deceased person’s finances, which includes finding the will, taking an inventory of the estate, paying taxes and debts, and distributing remaining property among the heirs of the deceased. To help with this process, an executor may hire professionals such as an attorney or accountant.
Find, read, and file the will
One of the first duties of an executor is to find the deceased person’s latest will. The executor is responsible for finding the will, reading it, interpreting it, and filing it in a probate court, if appropriate. The will may be located among the belongings of the deceased, or it may already be filed in court. Other times, the lawyer who drafted the deceased’s will may still have the original. After finding the will, the executor should notify all beneficiaries, or people mentioned as inheritors in the will.
Notify banks and cancel credit cards
When a person dies, the executor of the estate is in charge of notifying entities like banks, Social Security, credit card companies, savings accounts, loans, the post office, Medicare, Department of Veterans Affairs, and other organizations. Specific tasks include canceling the deceased’s credit cards, terminating any leases the deceased had, and collecting life insurance.
Set up a bank account for the estate
To handle any debts still owing to the deceased, or other sources of income such as last paychecks and stock dividends, the executor usually sets up a new bank account for the estate. The law generally requires the executor to keep the estate’s funds separate from his or her own.
Take an inventory of the estate’s assets
Some states require the executor to file an inventory of the estate’s assets. Making a list of assets also helps with managing the deceased’s property and distributing it to beneficiaries of the will later on. Assets may include real estate, a safe deposit box, investments, business interests, personal property, important papers, and other valuables. Managing assets may mean getting appraisals, selling certain assets, supervising rental properties and businesses, making arrangements for out-of-state properties, and searching for additional cash or valuables around the house. The executor is also in charge of protecting the estate’s assets until they are distributed. Depending on the value of the estate’s assets, the executor decides whether or not probate is necessary.
Pay remaining bills and debts
After setting up a bank account and transferring the estate’s monetary assets into the account, the executor pays remaining expenses like mortgage payments, utilities, homeowner’s insurance premiums, and any debts still due to creditors. Before paying off the deceased person’s debts, the executor also notifies creditors of the death and probate proceeding, if there is one. Usually, these debts must be paid before the remaining property can be distributed among the beneficiaries of the will. Any money still owing should be paid by the estate rather than from the executor’s personal funds, and the estate generally takes care of funeral expenses and probate and administration expenses before paying off debts.
The estate’s bank account should also be used to pay the deceased’s final income taxes. For large estates, state and federal taxes may also be due. The executor also files income tax returns for the current year, beginning on the first of the year and ending on the deceased’s date of death.
Distribute the estate’s assets according to the will
After taking an inventory and paying creditors, the executor distributes the estate’s remaining assets to the beneficiaries mentioned in the will. If no will exists, or if certain properties are not mentioned in the will, then the executor distributes property according to state intestate laws. Sometimes, distributing property includes setting up a trust or selling properties. After distributing property according to the will, the executor decides how to dispose of any remaining properties.
Throughout the process of managing and closing the estate, the executor should keep accurate records of expenses, income, and distribution, which the beneficiaries will review before the distribution process is finalized.
After everything has been distributed and the probate has been filed, the executor may pay attorney or accountant fees, then file a final report in court to close the estate.