If you’re a beneficiary of an estate, you should consider appointing a separate executor, preferably someone who is not also a family member or best friend. This can be a difficult decision for beneficiaries, as they will likely want to be certain of what happens to their inheritance. Aside from legal concerns, beneficiaries are likely to have many questions about how the estate will be handled.
As an executor, you have a duty to protect assets and make them as productive as possible. If a beneficiary receives an inheritance from a property, for example, you must charge the brother rent based on the fair market value. You must also inform the brother of the rent and how it will be paid. This will help ensure that all beneficiaries receive the inheritance in the best way possible.
Unless the beneficiary is specifically named in the will, the executor needs to find all assets of the estate, including any non-probate assets. These assets include bank accounts held for another person, retirement accounts, life insurance, and IRAs. These assets must be appraised by a competent appraiser to determine their value. This will also ensure that the beneficiary doesn’t receive less than the value of the property.
As the executor, you are legally obligated to account for the estate’s assets and liabilities. This means that every dollar earned or spent must be noted. This process is called judicial accounting. Unlike informal accounting, judicial accounting will help you obtain a discharge from your duties if necessary. An executor is also entitled to receive compensation. This compensation, however, depends on the size of the estate, so you may be able to get away with a waiver if your estate is small.
The time required for the executor to settle the estate is lengthy and can take months or even years to complete. A decedent’s estate must be settled before the Executor can distribute his or her assets to the beneficiaries. This process can take several months or even years, depending on the complexity of the estate. In addition, the Executor has the right to delay the distribution of assets, and cannot be forced to distribute the estate if a deceased person didn’t sell his or her property.
When making a will, it’s important to consider family dynamics and the financial aptitude of the successors. Sometimes, the surviving spouse is an appropriate choice, as long as the person isn’t unfamiliar with personal financial matters or is unlikely to become overwhelmed by the responsibility. If your estate is particularly complex, it may be best for the executor to hire an attorney. However, a good executor can help ease the burden of probate.
An executor has the responsibility of filing and paying taxes associated with the decedent’s estate. The executor must also take care of the debts the decedent had and to pay estate income taxes. A good executor should also hire the decedent’s accountant to help with the estate’s taxes. If the decedent owned a business or a home, he or she may need a fiduciary accountant. While this person’s experience with tax returns is important, a good accountant may not be familiar with preparing fiduciary returns.
In the event that the beneficiaries cannot find an executor, the local probate court will appoint one. The executor is then given letters testamentary, which authorize them to act in the best interest of the estate. The role of an executor is not open to everyone, and there are a number of disqualifications for living executors. Some of these include incapacity, felony conviction, and conflict of interest.
