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Their duties include much more than just distributing the deceased person's assets.
An executor is the legal representative of a deceased person’s estate
The executor not only distributes assets, but maintains them, too
You can turn down your role as an executor
Executors don’t get special benefits, but they are paid for their duties
The executor (less commonly known as an executrix, for a female executor) is the person responsible for carrying out the terms of a will. The will is a document that contains the last wishes of the decedent, or deceased, including how their property should be distributed.
Also known as a personal representative, the executor of the estate does more than just read the will to the future heirs; he or she also manages the deceased’s unfinished and ongoing affairs, like closing bank accounts and paying debts, and protects and maintains all of the deceased’s assets and belongings.
If you have a trust, then a trustee will fulfill a similar role to the executor.
Being an executor is a great responsibility and potential burden, especially if the estate is large or there are many beneficiaries. Probate, or the process of proving the will and distributing assets, also has the potential to take a long time. We’ll discuss how an executor is appointed as well as their varied duties.
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The executor is typically named in the will by the testator, or writer of the will. If there is no will, the court will appoint an executor, called an administrator, and the estate assets will be distributed according to each state's intestacy laws.
While being an executor can be seen as a privilege, the appointed person is not obligated to take on the role. If this is the case, someone else can petition the probate court to become the executor, or the probate judge will find a successor based on state laws.
As part of your estate planning, if you’re drafting a will, you can help make probate easier for your executor by showing them the will ahead of time. Similarly, if you know that you’ve been appointed executor of the estate of a friend or family member, you can plan ahead by familiarizing yourself with the will and asking the testator to keep a record of assets and valuables. This will save you time and effort later in the future once the testator has passed away and the probate process begins.
It’s typically permissible to have multiple executors and even to choose a beneficiary to act as executor, too. Some people might prefer having the executor be a close friend or family member like a spouse, but others might seek a neutral third-party.
Virtually every state requires the executor of the estate to be competent and may have other requirements. There’s typically an 18 years-old age minimum to be an executor, but it's 19 in Alabama and Alaska, and 21 in Utah. Some laws might require that the executor must be a resident of the same state. It’s important to ask an estate planner or attorney for legal and advice and about any restrictions in your area.
As the legal representative of the estate, the executor has many duties and responsibilities. If you’ve been asked to be an executor, you might want to first consider them before making a decision.
The executor must file the will and death certificate to the local county probate court within a few days to a month after the death of the testator. This is a necessary step even if the will won’t end up going through the probate process (for instance if everything is being passed on to the surviving spouse).
If as the executor you decide the estate must go through probate, you’ll file a petition with the clerk's office. They will issue you a legal document, called letters testamentary, that deems you the fiduciary of the decedent’s estate.
Payable-on-death or transferable-on-death accounts like bank accounts and life insurance policies do not pass through probate. These assets typically already have named beneficiaries in place and will directly transfer. Smaller estates that don’t have many assets beyond the previously mentioned accounts might go through faster probate. In other circumstances, all property might be held by two parties, easily designating who gets ownership of the assets, such as under a joint will.
The executor will need to notify others of the death of the testator. This isn’t limited to only people like family and friends, but financial institutions and government agencies as well, including the following:
Throughout the probate process, the executor will be responsible for maintaining assets, managing daily usually expenses, and paying debts and taxes, all of which requires money. The executor will pay for these expenses using the probate estate funds, which requires them to open a bank account in the name of the estate. To open one, you’ll need the letters testamentary and the testator’s death certificate if you're the executor.
This account can be used to hold payments and fund ongoing expenses (including funeral expenses) and pay debts and taxes, which we’ll discuss later.
The title of the bank account usually follows this format: “Your name, Executor, Estate of testator’s name, deceased.” If you’re the executor, you will sign your name this way as well.
As executor of the estate, you might end up paying for some expenses (like travel costs) out-of-pocket. Sometimes you won’t be reimbursed until long after probate is over (if at all, in the case of travel expenses) so it's important to consider before accepting the role
Before any assets can be distributed, all debts must be paid or settled. The executor will pay off creditors and dispute outstanding bills when necessary. Beneficiaries aren’t responsible for any outstanding debt — unless they cosigned with the creditor — in the event that the deceased did not leave enough money to pay off creditors. (The beneficiaries may however have to pay an inheritance tax on what they receive.)
An income tax return must also be filed and paid for the time until the testator’s death. Large estates may incur a federal estate tax, which the executor will arrange to pay with the estate bank account.
In some states, the executor might be required to keep an inventory of all assets. Even if it’s not needed, it might be a good idea to stay organized.
All of the decedent’s assets must be managed and protected. That means family members and beneficiaries can’t take any belongings — even the smallest of items and if they’re absolutely sure they’re entitled to them — until the probate process is complete.
The executor also needs to take care of the larger probate assets as well. This could mean making sure that the deceased person’s vehicle is not towed and that mortgages are paid and any rental property is maintained and the rent collected. Sometimes the will or state law might allow for the executor sell any real estate if they think it’s in the best interests of the estate.
Other assets might require a little bit of searching. The executor will have to find the deceased’s life insurance policy and financial assets, like bank accounts and investment accounts. These payable-on-death accounts might not need a will to be passed along to beneficiaries, but they are still important for the executor to locate, if only to close them out.
Only after all debts and taxes have been paid, should you begin to distribute the assets since you can be held responsible for any insufficient assets. Some states might even require court approval before this can be done. It might also be a good idea to get a receipt or written signatures of beneficiaries as written proof that they have received their inheritance.
As you think about your estate plan, make sure life insurance is a part of it.
Policygenius can help you choose a policy that protects your family and fits your budget.
The executor of the estate cannot take everything or bend the terms of the will for his or her needs. It is the legal duty of the executor to execute the will according to its terms, and if they do not, the beneficiaries can take legal action and file a petition against what they believe to be improper conduct.
It is standard procedure for the executor of the estate to receive payment for his or her duties. The role of executor after all is a great responsibility and entails a lot of work, especially with larger more complicated estates.
The deceased person usually dictates the payment in the will as a flat fee or a portion of the estate, but if he or she forgot, then state law will decide. When the executor is also a beneficiary (which is sometimes the case as previously mentioned), he or she may choose to pass on their executor compensation.
If you're the executor, you can get paid as soon as debts are paid, and before assets are distributed — but some states might require you get court approval first, por wait until probate has ended after closing the estate to receive compensation.
While an inheritance is usually not subject to income tax, any compensation received from acting as the executor must be filed as income on your tax return.
Broadly speaking, the executor cannot do anything against his fiduciary duties to the estate, like taking everything for himself or herself.
Other things an executor cannot do:
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