The responsibilities of being an Executor
September 2017 | Joseph Bestreich, Esq.A loved one has decided to name you as their Executor. Take a moment to appreciate how this person thinks of you. For someone to name you as Executor in their Last Will & Testament, that person must have a pretty high opinion of you.
Someone should always name as their Executor a person they feel is honorable, well-organized and highly responsible. The Executor is the representative of a deceased person’s (decedent) estate as named in the decedent’s Last Will & Testament.
As the old adage states, “With great power, comes great responsibility,” and this could not be more true. Executors have an enormous responsibility when it comes to dealing with a decedent’s affairs. Don’t let that dissuade you from accepting the role of Executor, though, as it will give you tremendous insight into how to handle and organize your own affairs.
An important point that all potential Executors should know is that even if you are appointed in someone’s Last Will & Testament as Executor, you are not required to accept the responsibility.
Many people decline acting as an Executor for a variety of reasons, and you can decline such a role without giving a reason. A piece of advice I give all of my clients is to always have a backup in mind for any appointed designation, whether that be an Executor, Health Care Proxy, Power of Attorney or beneficiary. Life happens fast and not having a backup in place could lead to unintended consequences.
Thus far, all you know is that the Executor is the representative of the decedent’s Estate, but you might be asking yourself what Executor actually does? First and foremost, as mentioned previously, being named as Executor does not automatically make you representative of the decedent’s Estate.
The Last Will & Testament is brought to the Surrogate’s Court in the decedent’s respective county beginning the process known as Probate. Once the proper paperwork has been filed and notice has been given to all interested parties, the Surrogate will give authorization to the Executor to represent the decedent’s estate in a document called Letters Testamentary.
There are several documents that need to be provided to the Surrogate’s Court before the Executor will be given Letters Testamentary. The Surrogate’s Court will always require a Petition for Letters Testamentary, a certified Death Certificate, and the original Last Will & Testament with an Affidavit of the Attesting Witnesses (this is usually, but not always, attached to the Last Will & Testament).
Some of the information required to include within the Petition is basic information on the decedent, the names and addresses of the closest living relatives of the decedent along with an estimation of the value of the estate.
An estimation is sufficient since it can always be adjusted if there are assets that the Executor is made aware of after receiving the Letters Testamentary. As you might have realized at this point, the Executor is tasked with knowing a significant amount about the decedent in order to obtain the Letters Testamentary.
Obviously, this is not always the case, and the Probate process can be delayed significantly while this information is obtained or while the Petitioner does their due diligence in attempting to get all of the requisite information.
If you have been named an Executor of an estate and intend on serving as such, I advise that you either know most of this information or have a way of easily obtaining it. I always suggest having an open and honest dialogue with the person nominating you as Executor. Some may feel uneasy talking about such an issue, but most will feel glad that they did once it is time to provide the necessary information in Surrogate’s Court.
Next, the Executor must access and manage the decedent’s property in a quick but substantive manner. It is also vitally important for the Executor to keep detailed records of all the assets that come into the Executor’s control.
The Executor has a duty to the beneficiaries of the estate to preserve as much value of the estate as possible by limiting expenditures. The Executor should expeditiously review bank statements to determine if there are any automatic deductions being taken from the decedent’s accounts.
Reviewing these accounts is also beneficial in determining any other institutions – such as insurance companies or a safe deposit box – where the decedent has additional assets.
A growing industry that requires more work for the Executor is digital assets. Online banks or vendors such as PayPal or Venmo manage online accounts for individuals and may have sizeable balances unbeknownst to loved ones.
If you are one of these people, it is highly recommended to have a list of your digital assets with passwords kept in a safe place, usually alongside your Last Will & Testament.
As these digital accounts and passwords change on a consistent basis, it is not advised to add these to your Last Will & Testament. If the prospect of keeping a list of all your passwords seems overwhelming or nerve-wracking, there are secure databases to load your usernames and passwords. However you decide is the best way to keep such a list, taking some steps to ease the burden of the Executor is sensible.
It is important to know that the Executor is not personally liable to any debts owed by the estate, unless he or she is a debtor as well. The Executor is responsible to pay from the estate any claims put in by a creditor.
Creditors have seven months from the time Letters Testamentary are issued to put in a claim against the estate. If they fail to do so within that time period, the estate is no longer liable for the distributions it makes to the beneficiaries.
Once any debts and/or taxes have been paid, assets can be distributed amongst the beneficiaries as stated in the Last Will & Testament. The Executor distributes the assets and receives a “Receipt and Release,” which is proof that the beneficiary received their share.
An informal accounting is typically done as proof of all the assets brought in and liabilities paid out is done by the Executor and then submitted to the Surrogate’s Court in order to close the estate.
Someone should always name as their Executor a person they feel is honorable, well-organized and highly responsible. The Executor is the representative of a deceased person’s (decedent) estate as named in the decedent’s Last Will & Testament.
As the old adage states, “With great power, comes great responsibility,” and this could not be more true. Executors have an enormous responsibility when it comes to dealing with a decedent’s affairs. Don’t let that dissuade you from accepting the role of Executor, though, as it will give you tremendous insight into how to handle and organize your own affairs.
An important point that all potential Executors should know is that even if you are appointed in someone’s Last Will & Testament as Executor, you are not required to accept the responsibility.
Many people decline acting as an Executor for a variety of reasons, and you can decline such a role without giving a reason. A piece of advice I give all of my clients is to always have a backup in mind for any appointed designation, whether that be an Executor, Health Care Proxy, Power of Attorney or beneficiary. Life happens fast and not having a backup in place could lead to unintended consequences.
Thus far, all you know is that the Executor is the representative of the decedent’s Estate, but you might be asking yourself what Executor actually does? First and foremost, as mentioned previously, being named as Executor does not automatically make you representative of the decedent’s Estate.
The Last Will & Testament is brought to the Surrogate’s Court in the decedent’s respective county beginning the process known as Probate. Once the proper paperwork has been filed and notice has been given to all interested parties, the Surrogate will give authorization to the Executor to represent the decedent’s estate in a document called Letters Testamentary.
There are several documents that need to be provided to the Surrogate’s Court before the Executor will be given Letters Testamentary. The Surrogate’s Court will always require a Petition for Letters Testamentary, a certified Death Certificate, and the original Last Will & Testament with an Affidavit of the Attesting Witnesses (this is usually, but not always, attached to the Last Will & Testament).
Some of the information required to include within the Petition is basic information on the decedent, the names and addresses of the closest living relatives of the decedent along with an estimation of the value of the estate.
An estimation is sufficient since it can always be adjusted if there are assets that the Executor is made aware of after receiving the Letters Testamentary. As you might have realized at this point, the Executor is tasked with knowing a significant amount about the decedent in order to obtain the Letters Testamentary.
Obviously, this is not always the case, and the Probate process can be delayed significantly while this information is obtained or while the Petitioner does their due diligence in attempting to get all of the requisite information.
If you have been named an Executor of an estate and intend on serving as such, I advise that you either know most of this information or have a way of easily obtaining it. I always suggest having an open and honest dialogue with the person nominating you as Executor. Some may feel uneasy talking about such an issue, but most will feel glad that they did once it is time to provide the necessary information in Surrogate’s Court.
Next, the Executor must access and manage the decedent’s property in a quick but substantive manner. It is also vitally important for the Executor to keep detailed records of all the assets that come into the Executor’s control.
The Executor has a duty to the beneficiaries of the estate to preserve as much value of the estate as possible by limiting expenditures. The Executor should expeditiously review bank statements to determine if there are any automatic deductions being taken from the decedent’s accounts.
Reviewing these accounts is also beneficial in determining any other institutions – such as insurance companies or a safe deposit box – where the decedent has additional assets.
A growing industry that requires more work for the Executor is digital assets. Online banks or vendors such as PayPal or Venmo manage online accounts for individuals and may have sizeable balances unbeknownst to loved ones.
If you are one of these people, it is highly recommended to have a list of your digital assets with passwords kept in a safe place, usually alongside your Last Will & Testament.
As these digital accounts and passwords change on a consistent basis, it is not advised to add these to your Last Will & Testament. If the prospect of keeping a list of all your passwords seems overwhelming or nerve-wracking, there are secure databases to load your usernames and passwords. However you decide is the best way to keep such a list, taking some steps to ease the burden of the Executor is sensible.
It is important to know that the Executor is not personally liable to any debts owed by the estate, unless he or she is a debtor as well. The Executor is responsible to pay from the estate any claims put in by a creditor.
Creditors have seven months from the time Letters Testamentary are issued to put in a claim against the estate. If they fail to do so within that time period, the estate is no longer liable for the distributions it makes to the beneficiaries.
Once any debts and/or taxes have been paid, assets can be distributed amongst the beneficiaries as stated in the Last Will & Testament. The Executor distributes the assets and receives a “Receipt and Release,” which is proof that the beneficiary received their share.
An informal accounting is typically done as proof of all the assets brought in and liabilities paid out is done by the Executor and then submitted to the Surrogate’s Court in order to close the estate.