The role of the executor
You've just
been asked by your best friend to be the executor of his estate.
While this position is an honor, it carries a heavy responsibility.
Before
agreeing to this undertaking, be aware of what's involved.
What
are the duties of an executor?
The responsibilities
can be at once complicated and demanding. Here is a general
overview:
- Obtain
a letter of authority. The will must be delivered to the
appropriate office, usually the county courthouse, in order
to obtain a letter of authority which is necessary to perform
the duties of the executor.
- Provide
notification of death. In most instances, it will be the
executor's responsibility to notify all pertinent parties:
the Social Security Administration, life insurance companies
and former employers.
- Evaluate
all assets. An executor must obtain an inventory of all
assets and determine their worth, through appraisals and
current market values.
- Pay
off all debts and settle all claims. Before distributing
assets to the beneficiaries, all debts and taxes must be
addressed. Payment schedules must be adhered to in order
to avoid interest and penalty charges that may be incurred
from income or estate taxes. Most states require settlement
notification through a local newspaper to allow creditors
an opportunity to make claims. Settling these claims may
involve disputing dubious ones.
- Distribute
notification of final accounting. All interested parties
should receive final notice indicating that all debts have
been settled, and all assets distributed, and a sworn statement
to that effect should be submitted to the court.
Consider
professional assistance
The position
of executor should not be taken lightly. As executor, you
will be legally responsible for estate affairs; that means
any disputes or mishaps could expose you to legal action.
If you are hesitant about accepting this appointment, consult
a professional who may be better suited to offer advice.
|
What
makes a good executor?
Because
the appointment is very involved, the person chosen
should be meticulous, responsible and trustworthy. Due
to the possibility of legal entanglements, the appointee
should also be free from conflicts of interest with
the beneficiaries. Aside from these personal issues,
there may be legal ones as well, including residency
requirements posted by some states. Check with local
laws before committing.
|
|
|
The above article is for general information only and is not
intended to provide specific advice or recommendations for
any individual. Consult your attorney, accountant, or financial
or tax advisor with regard to your individual situation. ©
Mutual of America Life Insurance Company January 2003. All
rights reserved.
Mutual
of America Life Insurance Company is a Registered Broker-Dealer.
|
