Do’s And Don’ts Of Being An Executor
Have you been named the executor for a will or estate? Unless you are an attorney, chances are you have no idea what is expected of you. With that, here are do’s and don’ts of being an executor.
5 Do’s Of Being An Executor
Do take the job seriously. Being named an executor is an honor, but the responsibilities can be overwhelming. A lot of people are counting on you to do a good job and to fulfill your fiduciary duties. An executor can be held personally liable if he or she mismanages an estate’s assets or breaches their fiduciary duties.
Do keep the beneficiaries up to date. The heirs want their money and can become impatient. Set expectations for your communication with them, and then send regular progress reports.
Do open a bank account for the estate. Executors should never comingle estate funds with their own funds. A separate bank account is absolutely necessary, and it also makes it easier to track the estate’s income and expenses.
Do seek the assistance of professionals. Some executor tasks demand that you hire outside professionals, such as accountants, appraisers and attorneys.
Do pay all of the estate’s obligations and taxes before making distributions. Failure to do so could expose you to liability.
5 Don’ts Of Being An Executor
Don’t let the grandkids drive grandma’s car. It is tempting to let family members use the deceased’s property, such as vehicles and houses. Do not allow it, because it can expose the estate to liability.
Don’t be afraid to renunciate. There is no shame in saying you are not able to serve as the executor. In fact, renunciating the executorship is the right thing to do if, for any reason, you cannot serve.
Don’t forget to continue paying the estate’s obligations. If the deceased owned property, for example, the estate must continue to pay any mortgage, all property and casualty insurance, and all other expenses necessary to safeguard estate property. If property is damaged, lost or destroyed and you did not insure the same, you can be held personally liable.
Don’t put your interests above those of other beneficiaries. If you are an executor and also a beneficiary, it is absolutely crucial that you not favor yourself over others. Remember, you are representing the estate, not yourself. Executors cannot self-deal.
Don’t feel like you have to work for free. The law does not expect you to perform your duties free of charge. But before the estate pays you, make sure the payment amount complies with the law.