According to Jayson Lenox of Beck & Lenox Estate Planning and Elder Law, when someone known as a “testator” creates a will for him or herself, that person selects an “executor” to handle the distribution of assets contained within the will once the testator dies. The executor is usually a spouse, close family member or trusted friend. If no such person is available, a qualified and compensated person can be appointed under state law, according to a recent article from The Street entitled “Top Duties of an Estate Executor and How to Carry Them Out.” What exactly does an Executor do?
Depending on the complexity and size of the estate, the executor’s duties could include additional tasks. However, the following are the five main categories:
- Filing the will with the court
- Gathering documents
- Paying debts and taxes and collecting from any debtors
- Closing out Social Security accounts, insurance policies and retirement accounts; and
- Maintaining any real estate property, until it is sold or ownership is transferred to an heir.
The executor needs to be trustworthy and organized, since there are many details involved. Once the will is filed with the court and the will is deemed to be valid, the court will issue “Letters Testamentary”, which empowers the executor to go forward with their tasks as directed by the will.
The executor needs to gather documents, including:
- Death certificates
- Deeds and titles of ownership
- Trust documents
- Insurance policies
Combine Assets and Close Accounts
The executor needs to contact the decedent’s banks, credit card companies, lenders, leasing companies and any accounts holding assets.
The executor also applies to the IRS for an estate tax ID number, also known as an EIN, and opens an estate bank account. This is where any assets are deposited, including proceeds from the sale of any assets.
The Social Security Administration needs to be notified of the death. Depending on the date of death, the last Social Security deposit may be recouped from the decedent’s bank account. If there is an eligible survivor, the executor may help the spouse or dependent apply for benefits.
Collect Money Owed and Pay Debts
The executor may help beneficiaries file for life insurance proceeds.
The executor needs to examine and adjudicate any outstanding debts owed to the decedent and handle any creditor claims. The debts are not the financial responsibility of the executor and should be paid only from funds in the estate account.
With good planning, the executor can ensure an orderly and uncontested flow of assets from the deceased’s estate to heirs. This includes consultation with the testator while they are still living and can discuss their wishes and plan for a smooth transition. This is certainly not the most comfortable discussion. However, it can make the process easier for all concerned, if done with kindness and care in advance.
If you are ready to create your will and select an executor, you may want to consult with us at Beck & Lenox. One tip we always give our clients is that you do not have to choose your eldest child for this responsibility. You want the best equipped person for the job. Contact us here for a free phone conversation with one of our attorneys.
Reference: The Street (Dec. 5, 2022) “Top Duties of an Estate Executor and How to Carry Them Out”