Estate Administration can be a very long and difficult process. It is important to choose the right person as the Executor of your Estate. The Executor is the person responsible for administering your estate. There are five main responsibilities of an Executor (1) Filing for Probate; (2) Marshalling Assets; (3) Determining Cash Needs; (4) Paying Reasonable Debts and Expenses and; (5) Distributing the assets in accordance to the decedent’s wishes.
- Filing for Probate
The Executor of the decedent’s Estate needs to locate the Original Will as soon as possible after a decedent’s passing. The Original Will is needed in order to probate the Will with the Court. Do not unstaple the original Will. Unstapling the Will can create difficulties in the probate process. An executor cannot act until after the Court has granted the Executor Letters Testamentary. This can take time, therefore it is important to consult with an attorney and file for probate as soon as possible after a decedent passes away.
- Marshalling Assets
Once an Executor is granted Letters Testamentary, the Executor can begin to marshal the assets that were held in the decedent’s individual name. This will likely include opening an estate account at a financial institution. It is important for the Executor to be organized and clean in their record keeping during the Estate Administration. The Executor will want to receive the date of death value of each asset the decedent held.
- Determining Cash Needs
The Executor needs to determine the cash needs of the Estate. The Executor will need to contact various institutions to close accounts and make sure the decedent does not have any debts. This can be a cumbersome task as we all deal with numerous companies and have a lot of different bills like credit card, utility, cable and mortgage bills. In addition, the Executor will need to determine if the estate owes an estate tax. Currently in New York, the Estate tax exemption is $5,850,000 and the Federal Estate tax is $11,580,000.
- Paying Reasonable Debts and Expenses
An Executor is responsible for paying all debts and expenses of a decedent. This includes funeral, legal, tax and other expenses that might occur during the administration process. The Executor will also need to work with an accountant to file the final tax return for the year the decedent lived and if the Estate accumulated any income then a Fiduciary Income Tax return for the Estate may be necessary.
- Distribute assets in accordance with the decedent’s wishes
Distribute the decedent’s assets in accordance with their Last Will & Testament. Before making any distribution it is recommended to have the beneficiaries sign a receipt & release agreement. This will release the Executor of liability.