During the estate planning process, you need to select an executor to carry out your wishes. Insurance News provides some things you should know about the executor’s duties in its recent article, “The Wrong Executor Can Destroy Even the Best Estate Planning.”
Executors sometimes are under the impression that it’s a quick and easy job. This might be the fault of the testator or the person who has executed the will. They select an executor and believe that he or she possesses the ability, acumen, time, and desire to carry out the duties of the position. Many don’t inquire as to whether the executor is interested in and capable of serving, or the chosen executor may be hesitant to say no.
Prior to designating an executor, the testator should understand the role and consider whether the potential executor has the qualities to handle the job. In addition, the testator should discuss the decision thoroughly with the chosen executor so everyone understands the expectations and what is needed to do the job.
A big mistake is an executor’s failure to communicate adequately with the decedent’s family, friends, heirs, and loved ones. People like to be kept updated and to understand why some things have been done or not done. This can help keep peace and family harmony at a very emotional time.
On such example involves family heirlooms. The executor can distribute the assets as he or she wants as long as his or her actions comply with the will, but beneficiaries may have particular interests in specific assets like heirlooms and collectibles. There can be headaches and heartaches if the executor unwittingly distributes an item to another heir who’s not as emotionally tied to the item. It’s best to talk to the heirs and determine their preferences.
Another problem can arise when the heirs aren’t satisfied with the time needed to finalize the estate—particularly if one of the heirs is also the executor. Conduct regular update meetings with all parties who have an interest in the estate.
An executor’s job isn’t simply to distribute wealth—it’s to make certain that all debts and liabilities are discovered and resolved and to handle and finalize the decedent’s day-to-day affairs. The list of the executor’s duties is quite long and includes the following:
- Dealing with the court to probate the will and distribute the assets;
- Collecting all of the assets, which means combing through the decedent’s belongings and records and also dealing with banks, brokerage houses, insurance companies, and the decedent’s employer;
- Valuing assets;
- Keeping the assets safe;
- Handling the decedent’s creditors;
- Maintaining businesses while the estate process is proceeding;
- Winding up the decedent’s last affairs; and
- Filing tax returns and investigating estate taxes.
In many instances, no one is thanking the executor. Rather, they may find fault with his or her actions. Because of this, it’s critical to have a thorough understanding of the job. Also, the person must have the capabilities and the wherewithal to undertake this major responsibility.
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Reference: Insurance News (June 2016) “The Wrong Executor Can Destroy Even the Best Estate Planning”