It’s an honor to be named executor of a will, but it’s also hard work. While most executors understand their role, there can be a lot of confusion when it comes down to getting things done. Unless you work in the legal industry, the order of the process, the different types of paperwork and all of the loose ends can be difficult to manage.
Your role is to oversee that the estate plan is carried out, that the deceased’s will or trust successfully passes assets from one owner to another. Before that can happen, you need to close any debts, pay taxes, file paperwork and locate all of the property that’s about to change hands. It’s highly detailed work.
Financial website Bankrate offers a seven-step checklist to guide executors through the process. It addresses many of the key duties of an executor and opens the door for variables that might surface along the way. We’ve condensed the list in our discussion below.
Report the death
The first step in estate plan administration is obtaining the death certificate. This is necessary for notifying accounts, banks, insurance companies, Social Security and others about the changes to come. Formal paperwork is required with these accounts, and a phone call stating that your loved one has passed away will not be enough.
File with probate court
You already know that you’re the executor of the estate plan, hopefully. If so, the next step is to file the estate plan with the local probate court. Your process with be different here depending if it is a will or trust. You will also need the court to formally appoint you as the executor. You will then receive legal authority to manage the estate.
Locate and manage assets
While most people think of an estate plan as the distribution of assets, your role is to close the estate before distribution begins. You will need to locate all of the deceased’s assets. In addition to physical property and investments, this also includes outstanding debt, bills and taxes.
Pay off debt
Debt does not simply refer to an unpaid mortgage or medical bills. It includes day to day expenses that accumulate even after a person dies. Did she or he own a home? In addition to a possible mortgage payment, the utility bills need to be paid. Most people have small accounts and subscriptions, like Netflix or the New York Times. It may take a while to identify all of the expenses. You will also need to pay all taxes for the deceased, including for the current year.
Distribution of assets
You should not distribute assets until everything is accounted for and full value has been measured. You are using the estate to pay bills and expenses, and the early distribution of an item named in the will might hinder your ability to pay bills. Make sure that your checklist is complete before distributing inheritance to others.
Don’t rush the process
While a checklist is a great resource, always remember that each estate plan is as unique as the person it represents. It’s an executor’s job to work through the legal process, letting it unfold at the appropriate pace and covering the variables in between. Learning these steps, how they work, and what variables can pop up is challenge enough by itself.
You will be in contact with the court, banks, insurance companies and various entities. Each industry has its own processes. As you work with the deceased’s taxes, will or trust, and probate court, let the process go at its natural pace. A missed step will come back to haunt you later. It’s wise to seek professional advice to guide you through the process.