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I’m an Executor. Now What?

On Behalf of | Oct 20, 2022 | Probate

After someone has died, the executor is the person appointed by the authorities to be in charge of winding up that person’s affairs and administering the estate, for the ultimate benefit of the beneficiaries.

If you are or will become appointed as an executor (or Administrator), you are entering a realm of many rules and sometimes rigid bureaucratic procedures.

An executor’s job is to do several things:

  • Gather the assets, and sometimes sell something that needs to be sold;
  • Pay the bills, debts, taxes and expenses that need to be paid; and
  • Pass out what’s left over to those who are supposed to get it.
  • Comply with estate and tax laws and account for their actions.

Paperwork, documentation, and official filings are required for the executor to record and report on what they are doing to accomplish these practical steps.

An executor is officially in charge of the “probate assets” that form the “probate estate” – that is, assets that were owned and titled and registered in the name of the decedent only.

“Non-probate assets” are those left behind with a pay-on-death beneficiary named, or a joint depositor with right of survivorship or something similar, in connection with any one specific account, policy, IRA, etc. Those “non-probate assets“ pass more or less directly to the named beneficiary or surviving joint owner, without the probate estate paperwork and probate court filings.

Filings in probate court of the probate assets are one part of an executor’s job. The underlying purpose of the probate court and its filing requirements is so that the authorities can (at least in theory) supervise what the executor is doing, to make sure that the bills and creditors get paid properly, and to make sure that the remaining estate is distributed to the right people in the right way. If there’s ever an argument or disagreement, the probate judge can decide the dispute.

One way to avoid the burden of  probate paperwork after you’re gone is by using a trust, such as a Revocable Lifetime Agreement of Trust, or so-called “Living Trust.”

An executor has a legal obligation and duty to act honestly and fairly, to preserve and maximize the value of the estate assets, to follow the requirements of the Will and other applicable law, to keep good records, to report and account to the authorities for their actions, and generally to do their job properly. The executor must also ultimately account to the beneficiaries, as well as to the authorities, for how they have performed their job, and account for all estate activity and the amount of the inheritance and distribution.

Also, preserving and maximizing the value of estate assets includes securing any real estate. If there is a home or other real estate in the probate estate, make sure to change the locks, confirm that it’s still insured, check the furnace during the winter to keep pipes from freezing, and collect the rents for rental property.

Safeguarding financial assets is equally important. As an Executor, your primary responsibility is to safeguard the principal value of assets. If financial assets are overly invested in wildly volatile investments, for example, it might be wise to change them to a more stable investment selection, to avoid losses.

An executor is not allowed to take advantage of their position to benefit themselves improperly, but is entitled to be paid compensation for services provided to the estate and the beneficiaries.

An executor’s job also includes taking care of Pennsylvania inheritance tax (and sometimes Federal Estate Tax), income tax issues, and undertaking the “nuts and bolts” of transactions such as selling assets, liquidating accounts, retitling or transferring ownership of property, and paying debts and expenses. For a married couple with an estate in the Federal estate taxable range – right now about $12 million per person, coming down to half of that in 2026 – filing a Federal estate tax return to claim the portability election can save huge amounts of taxes.

Perhaps the most important task of the Executor is communicating with stakeholders. People just want to be kept informed and know what’s going on.  Communicating about the estate administration process with the participants along the way can prevent confusion, suspicion and resentment.

In your own estate planning, think carefully about who you will name as executor, and as the backup or successor executor, too. Personally, I want someone with a good head and a good heart – a good head to deal with the money and business issues, and a good heart to deal with the people. You can also name more than one person as “Co-Executors” together.

At Marks Elder Law, every day we help people serving as executors, winding up the affairs of their loved ones and administering estates, with caring, trusting and professional skill and service. I invite your questions and feedback concerning this article or anything I can do to help you or your family.