The role of the executor (or executrix) of an estate plan or will is to ensure the deceased person’s assets are distributed according to their wishes. The executor is often named in the will or estate plan, but sometimes a court will appoint an executor to an estate if one has not been named.
Even if you are named executor, you don’t have to accept the position. You can also decline to continue in the position once you’ve started and the court will appoint someone in your stead.
What are the duties of an Executor
The overarching role of the executor of estate is to carry out the decedent's instructions. The executor has a fiduciary duty to do this, meaning they must act with integrity and honesty when dealing with the estate. They also must act with the best interests of the beneficiaries in mind instead of their own best interests. If a court finds that an executor did not fulfill his or her fiduciary duty, they can name someone else to take their place.
Some other notable responsibilities of an executor are:
Notify beneficiaries
One of the first things an estate executor must do is notify the beneficiaries, and this should be done in writing. Beneficiaries also have a right to know information about the estate, but that doesn’t necessarily mean that the executor will give them an itemized list.
Through the process of working through the estate, the executor may have to pay down debts with some of the assets which can reduce the final amount disbursed to beneficiaries. Because of this, beneficiaries should be notified in a timely manner, but they should not expect to receive their inheritance right away before the executor has had time to inventory everything, contact financial advisors, or field any calls from collectors.
Finding and organizing documents
Depending on how thorough the estate plan is (or if there is one), this job can be very easy or very difficult. It is up to the executor to find and organize all the estate documents including finding an original copy of the will if possible. These are often necessary for probate proceedings, and will be required to settle debts and disperse assets.
While it will vary depending on the estate, common documents are deeds and titles, insurance policies, investment or brokerage accounts, savings accounts, living trusts, and the descendant’s death certificate.
Pay estate’s debts and taxes
In addition to leaving behind assets, an estate also leaves behind any debt and tax burdens as well, and it’s up to the executor to pay these. These can often be paid by selling off portions of the estate or through funds remaining in accounts. These will all need to be taken care before any beneficiaries receive their inheritance.
Take inventory
You will now need to investigate all assets and make sure you’ve accounted for everything. This could me searching physically through a house or office, or electronically through a computer.
You’ll need to compile all this information and the documents you found into a list that also includes their valuation when the deceased died. You may need to enlist the help of an appraiser for this. Additionally, you’ll need to determine to whom each asset is going to.
Distribute Assets
After debts and taxes have been paid, and all assets have been inventoried and evaluated, the executor distributes assets. Each state will have different guidelines on the timeframe in which this should happen, but in general it should take place within a year. You should keep thorough records of all your dealings with assets management and distribution on the chance something is disputed or if the court requests documentation.
Transferring properties outside probate
Some properties will not have to go through probate to be distributed to beneficiaries, and can be handled more easily. The most common way this would happen is through a living trust where the trustee has already been transferred ownership.
This could also happen for certain investment, savings, or insurance accounts that have named beneficiaries. In this case they can be collected without going through the estate plan or court. There is also an option for simpler estates to be deemed a “small estate” by the court and settled out of probate, though the criteria for this varies by state.
Why an Executor is Important
The person you choose to be your executor is responsible for your entire estate—seeing that your assets are distributed to all your beneficiaries, paying off all debts and taxes, and following all your instructions to the best of their ability. If you have children, either minor or dependent adults, your executor will also be responsible for making sure they are with your preferred guardian. When estate planning, you’ll need to choose someone trustworthy, organized, and responsible for this position.
