If you find yourself named in a will as the executor of someone’s estate, your new role may feel overwhelming. After all, being an executor is something that most of us do only once or twice in a lifetime, and of course there’s a learning curve before we’re really comfortable with the process. The world of probate courts, lawyers, wills, and legal documents is unfamiliar and can be intimidating.
Add to that the fact that your new duties come at a difficult time. You’ve lost someone important to you—perhaps the most important person in your life. If the circumstances of the death were especially painful, just getting through daily life may feel daunting—never mind taking on a whole set of new legal and practical tasks. You may feel that you simply do not possess the energy necessary to sort through records, make phone calls, and make decisions.
It may take some time before you can attend to all these matters. It will also take time, diligence, and patience. But you can do it, with information from books and websites, and help from family, friends, and professionals.
You may be surprised to find that working your way through the elements of your job as executor, steadily tying up loose ends, can be satisfying. It is a way both of honoring the wishes of the person who has died and of performing a useful service to those still living. It is a way of saying good-bye and moving on.
Here’s a summary of what you’ll be doing when you serve as an executor:
Gather the deceased person’s assets. This part shouldn’t be hard, especially if the person’s assets were the common things that most people have: perhaps a house, a car, and some bank accounts and investments. If, before the person died, you got a handle on what he or she owned, it will be even easier.
Take care of them. You must safeguard the deceased person’s property (both real estate and personal property) until you hand it over to beneficiaries. This may involve making investment decisions or even managing business property, but your responsibility isn’t to make money, but instead just to avoid loss or damage.
Pay debts. You aren’t personally liable for the deceased person’s debts (unless you were married, in which case you may be). You’ll pay them from the deceased person’s assets.
Pay taxes. You will have to file income tax returns on behalf of the deceased person. You may also have to (most likely if the estate goes through probate and receives income) file an income tax return on behalf of the estate. Unless the estate is very large (more than $5 million), you won’t have to file a federal estate tax return. About half the states, however, impose their own estate tax. The rates are lower than the federal estate tax, but smaller estates are taxed; the threshold amounts go from $875,000 up to $5 million, depending on the state.
Distribute what’s left. You’ll transfer assets to the people who inherit them under the will or, if there isn’t a will, under state law. This may involve going to probate court, but many assets can be transferred without probate. In recent years, many states have simplified probate significantly, so even if probate is required, it shouldn’t drag on too long. There’s always a built-in waiting period, however, to give creditors time to come forward, so you can’t get through probate in less than four to six months, depending on the state.
It will probably take from six to 18 months to wind up a typical estate, depending on the circumstances and the procedures in your state. For the first week or so, you’ll make immediate practical decisions about securing property (a house, car, or pet for example). Over the next few months, you’ll handle financial and legal matters—for example, you might need to open an estate bank account or sell certain assets, and you’ll definitely have bills to pay. Tax matters will probably come later.
Unless the estate includes complicated property or serious disputes, none of an executor’s tasks requires out-of-the-ordinary financial or legal skill. You just need to be honest, careful, and willing to put the interests of the estate above your own. When you need advice from an expert—for example, a lawyer, investment advisor, or tax preparer—you can get it and pay for it with estate assets.
There’s one skill you do need, and that’s communicating with people. Unless you inherit everything, you’ll have to deal with beneficiaries who may run the gamut from selfless to greedy. Family relationships may be strained. You’ll also probably have to work with businesses, institutions, courts, and government agencies during the process. Doing this successfully takes patience, common sense, and persistence.