If you are asked to be an Executor, you should have some idea what that means. The Executor of an estate in Maryland, referred to as the Personal Representative, is in charge of managing, reporting, and distributing the probate estate of a decedent.
Investopedia’s recent article, “The Executor’s Checklist: 7 Tasks Before They Die,” reminds us that being the Executor of an estate means significant responsibility. It can be a daunting task if you’re unprepared.
We work with many people who have accepted the role and want our assistance. It is in some ways like walking into the middle of a movie and trying to find your bearings. Here are some simple steps to take while the testator (person making the will) is still alive to make the executor’s job easier:
- Be Sure to Know the Location of the Will and Other Estate Planning Documents. This is a no-brainer. You make the executor’s job easier, if the testator keeps the original will, deeds, partnership documents, insurance policies, or other important papers in an agreed-upon spot, with copies at a backup location.
- Retitle Accounts Where Appropriate. If the testator has a spouse, most likely they will want assets to flow directly through to the widow(er), so make accounts as joint and make sure that properties and titles are in both names.
- Make a List of the Testator’s Preferences. Another way to make things easy on the executor and the family is to include funeral preferences, which need to be in writing and signed by the testator.
- Draft a Possessions List and Their Recipients. A big issue that many executors overlook is distributing personal possessions that have little financial value but great sentimental value. Along with the testator, an executor can create a list for the dispersal of personal items and a system of distribution. The testator can include their reasoning for who got what gift. Sharing the list with those involved may also eliminate some hurt feelings. An organized dispersal can make an executor’s job easier and help with issues of fairness.
- Create an Annual Accounting Sheet and Updating Schedule. If the testator keeps track of the estate electronically on an annual basis, the executor will have a good idea of assets when it’s required. This e-document will also decrease the time spent searching for that jewelry the testator gave to a granddaughter or tracking down the funds that were supposedly in a now-empty investment account.
- Create a Sealed Online Accounts Document. An executor should also have a record of the testator’s online presence to deactivate accounts. This document simplifies work for the executor.
- Meet the Relevant Professionals. Executors should be familiar with the accountant, estate planning attorney, and other professionals the testator uses. They may have further advice specific to the testator’s situation.
Preparation will greatly decrease the odds of any complications when carrying out your duties as an executor. Take these actions while the person who asked you to serve as Executor is still alive to help you effectively carry out his or her wishes.
Additionally, understand this will be at least a part-time job for a year or so. You are entitled to a fee for serving. Our clients often say at the outset of serving that they will waive the fee. I tell them to keep track of their time, as they will earn the fee whether they take it or not. In the end, they are often asking, “How much is the Executor fee?”
I think expecting an Executor to serve without a fee is unreasonable. If I asked you to come to my house, value the contents, clear them out, distributed them (with little or no guidance), sell my house, go to settlement, and then prepare and file at least two tax returns for me, I would expect to pay you something for that effort. For most estates, that is the least being requested when you’ve been asked to be Executor.
Would you really ask someone to do all that work and not expect to pay them anything?
Reference: Investopedia (July 11, 2019) “The Executor’s Checklist: 7 Tasks Before They Die”