There are few things that demonstrate trust and respect quite like being named the estate executor for a close friend or relative. This person is placing his or her faith in you to make sure that their final wishes are fulfilled, especially with respect to the distribution of estate funds to their loved ones. However, if you have never served as an estate executor, then you should understand that there are many tasks with a great deal of responsibility. This is why it is crucial to understand your responsibilities and to consider working with an experienced Pennsylvania estate attorney.
What are the Duties of an Executor?
An estate executor plays a key role in managing the affairs of the deceased person. In many ways, they are the lynchpin of the estate. That is why it is important to make sure that each of these tasks is completed in chronological order.
If you are named the estate executor, the first thing you will need to do is to locate and file the will for the deceased in the probate court for the county where he or she was residing. There is a good chance that the attorney for the deceased will have an original, which you will need to file. This will initiate the probate process through which every will must pass in Pennsylvania. This will establish the will’s validity and gain the court’s authorization for you to administer the estate. However, if the deceased had a trust, then you may be able to forgo the probate process. This is something you should check with an experienced attorney with knowledge about the deceased person’s estate planning.
Once you have begun probate or established that probate is not necessary, you must gather and protect all of the assets of the estate. This may include real and personal property, bank accounts, life insurance policies, and investments. These will be needed to pay the expenses of the estate, with the remainder being distributed to the heirs or beneficiaries depending on the deceased’s wishes. The probate court or the trust document will provide you with the power to make such payments.
Next, you must notify the beneficiaries and heirs, as well as any creditors who have the right to file a claim against the estate. You will now have to pay the debts and expenses of the estate, while managing the accounts. This can be a very time consuming process. The key is to keep adequate records. While you are doing this, you should coordinate with an experienced Pennsylvania CPA to file all necessary tax returns for the deceased person and the estate. Usually, a final return will be filed for the year when he or she passed, with all subsequent years filed on behalf of the estate.
After you have paid off all of the debts, expenses, and taxes, you will be in position to distribute the remaining assets to the beneficiaries. You will need to follow the terms of the will or trust to make sure they are distributed properly. Once this is completed, you will file a final accounting with the probate court, showing the estate was properly administered and all assets have been distributed.
Is This a Challenging Process?
Yes, being an estate executor is very time consuming. You will need to make time to attend hearings, follow up with asset management like talking to brokers who handled the investment accounts, and coordinate with attorneys and accountants. You also may be administering a very complicated estate, with many different types of assets. So, you should be prepared to spend time focusing on these duties and making sure you are following proper procedures.
You should also keep in mind that you owe a fiduciary duty to the estate. This means that you have a legal obligation to act in the best interests of the estate and its beneficiaries and heirs. Therefore, it is vital to keep open communication with the beneficiaries, heirs, and creditors of the estate.
Can an Executor be Held Personally Liable?
As a fiduciary, you could face personal liability. You are tasked with acting in the best interests of the estate and a beneficiary or creditor could try to sue you if they suspect you are pursuing personal gain in your role as executor. Therefore, it is vital to keep thorough records to show that you did everything properly. You should also seek professional advice from experienced attorneys and accountants to make sure you are following all applicable Pennsylvania estate law and federal and state tax laws. Finally, you should always follow proper priority of payments, making sure to pay debts and taxes before you begin distributing any assets to the heirs and beneficiaries of the estate.
Contact Our Estate Attorneys Today
Performing the role of estate executor is a very challenging task. Even if the deceased only had a basic will with few assets and liabilities, you will still need to go through many tasks that you could be performing for the first time. Therefore, if you have been named an estate executor, you should contact the experienced Pennsylvania estate attorneys at Jones Gregg Creehan & Gerace. We will help walk you through the process making sure you are in complete compliance with all applicable laws.