If you become the executor of a will, you'll have more to do than read the will and distribute money to the heirs. As executor, you must pay for any funeral expenses, identify the decedent's debts and settle them, preserve the estate assets, and pay taxes for both the estate and the deceased. The money for all this ultimately comes out of the estate.
Executor Fees
As an executor, you're entitled to claim a fee for your services even if you're also a beneficiary. In Florida, executor fees run around 3 percent of the value of the estate. New York fees run from 2 to 5 percent as the estate's value increases. The decedent can set a different fee in the will, or, in New York, require that you waive the fee if you accept the post. The probate court may also adjust your fees if the job is particularly challenging.
Expenses
Part of your job as executor is to set up an account for estate funds you can tap to pay administrative costs. You also have the right to pay for an attorney, an accountant or an appraiser to help provide professional advice. If you have to pay some expenses yourself for any reason, you're entitled to reimbursement from the estate, which applies even to small out-of-pocket expenses, such as mileage or postage stamps. You will have to ask the probate court to approve reimbursement.
Keeping Records
You're better off if you pay executor expenses directly out of the estate funds whenever possible. Mingling your funds with the estate's could lead to charges you're cheating the beneficiaries, and you might lose track of which money goes in which account. Keep records of all of your out-of-pocket expenses so that you can present them to the probate court for reimbursement. The records will also show the beneficiaries your claims are completely legitimate.
Considerations
As executor, you have a fiduciary duty to act in the best interests of the estate and the beneficiaries, not yourself. If you are also beneficiary, you have to treat all the other heirs fairly and equally according to the terms of the will. If a beneficiary believes you're cheating her or mismanaging the estate, she can sue to have you replaced or to pay back expenses. If the court sides with the beneficiary, you could wind up unable to claim any money for your expenses.
References
- Buxton Law: FAQ
- Bathgate, Wegener & Wolf: Overview of Duties of Executor for Estate Administration
- Judicial Council of California. "Wills, Estates, and Probate - What Is 'Probate'?" Accessed April 27, 2020.
- Mergen Law LLP. "Definition: Executor and Executrix." Accessed April 27, 2020.
- Superior Court of California, County of Santa Clara. "What if There Is No Will?" Accessed April 27, 2020.
- Superior Court of California, County of Santa Clara. "How Long Does Probate Take?" Accessed April 27, 2020.
- Superior Court of California, County of Santa Clara. "Does the Court Supervise the Personal Representative?" Accessed April 27, 2020.
- Office of the Executive Secretary, Supreme Court of Virginia. "Probate in Virginia - What Are the Basic Duties of an Executor or Administrator?," Pages 4-5. Accessed April 27, 2020.
- New York State Unified Court System. "Probate." Accessed April 27, 2020.
- Superior Court of California, County of Santa Clara. "When Can a Will Be Contested?" Accessed April 27, 2020.
- Judicial Council of California. "Wills, Estates, and Probate - Step 1: Figure Out Who Will Be the Estate Representative." Accessed April 27, 2020.
- California Legislative Information. "Probate Code §8461."Accessed April 27, 2020.
- Alaska Court System. "Letters of Administration and Letters Testamentary." Accessed April 27, 2020.
- Alaska Court System. "Are Individuals and Businesses Protected if They Deal With the Personal Representative?" Accessed April 27, 2020.
- Alaska Court System. "How Do I Find Property Owned by the Person Who Died?" Accessed April 27, 2020.
- Superior Court of California, County of Santa Clara. "What Does the Personal Representative Do?" Accessed April 27, 2020.
- Alaska Court System. "How Do I Manage Financial Accounts and Cash?" Accessed April 27, 2020.
- Alaska Court System. "Inventory of Property, P-370." Accessed April 27, 2020.
- Alaska Court System. "What Is the 'Information to Heirs and Devisees?'" Accessed April 27, 2020.
- Judicial Council of California. "Wills, Estates, and Probate - Step 2. As Estate Representative, Start Gathering Information and Fulfilling Your Duties." Accessed April 27, 2020.
- Federal Trade Commission. "Debts and Deceased Relatives." Accessed April 27, 2020.
- Superior Court of California, County of Santa Clara. "How Do Creditors Get Paid?" Accessed April 27, 2020.
- Alaska Court System. "How Do I Reject a Claim?" Accessed April 27, 2020.
- Alaska Court System. "What Happens After I Send the Notice of Disallowance?" Accessed April 27, 2020.
- Legal Information Institute. "26 U.S. Code § 2032. Alternate Valuation." Accessed April 27, 2020.
- Internal Revenue Service. "Estate Tax." Accessed April 27, 2020.
- Tax Foundation. "Does Your State Have an Estate or Inheritance Tax?" Accessed April 27, 2020.
- Superior Court of California, County of Santa Clara. "How Are Taxes Handled in Probate?" Accessed April 27, 2020.
- Alaska Court System. "Do I Have to File a Federal Income Tax Return for the Person Who Died?" Accessed April 27, 2020.
- Superior Court of California, County of Santa Clara. "What Must I Do to Close the Estate?" Accessed April 27, 2020.
- Alaska Court System. "Does the Personal Representative Have the Right to Be Paid?" Accessed April 27, 2020.
- Superior Court of California, County of Santa Clara. "If I Serve as Executor, Will I Get Paid?" Accessed April 27, 2020.
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A Durham, NC resident, Fraser has written about law, starting a business, balancing your budget and fighting evictions, among other legal and financial topics.