If you are named as the executor, administrator or successor trustee of an estate after someone has died, you must comply with the written instructions the decedent left in the form of a will or a trust document. In the absence of such a document, you must observe the laws of intestacy in your state in order to determine how to distribute the decedent's assets. In come cases, you may be asked to divide shares of stock equally among heirs. Once you are vested with the authority to act on behalf of the decedent, the distribution process is relatively straightforward.
Copy the authorizing documentation. If the decedent had a living trust, you should be named in the documentation as the executor of the estate. Similar wording can be found in a will. If the decedent passed without leaving any instructions for his assets you will have to apply to the probate court to be designated as the administrator of the decedent's assets. Each state determines an order of priority as to who should be named an administrator.
Get a death certificate. You will generally need to present a death certificate whenever you act to move or distribute assets on behalf of the decedent.
Read the instructions for distribution. Along with your appointment as the manager of the decedent's affairs, look for specific instructions regarding to whom the decedent wished to bequeath his assets.
Get a copy of the decedent's financial statements. You can get bank and brokerage statements from the decedent's financial services firms by providing them with copies of the documents authorizing you to act on behalf of the departed along with a death certificate.
Calculate the split amounts for the heirs. The decedent's financial statements will show you how many shares of stock are in the estate for you to distribute. Divide the amount of shares by the number of heirs, following the instructions of the decedent. If shares do not divide equally, you may have to instruct the firm to liquidate the odd share and distribute the resulting cash proceeds equally. Another option is to include an extra cash payment amounting to one-half of the odd share for one heir while providing the other heir with the odd share. This way both heirs receive the same amount of total financial distribution.
Provide written instructions for the firm. Once you have calculated equal split amounts for all heirs, put it in writing and sign the form as the executor or administrator of the estate. The firm holding the account should act on your instructions immediately.
References
- Financial Web: How to Administer A Small Probate Estate
- NOLO: How Living Trusts Avoid Probate
- Federal Trade Commission. "Debts and Deceased Relatives." Accessed Oct. 13, 2020.
- Hanscom Federal Credit Union. "Here's The Difference Between An Heir And A Beneficiary." Accessed Oct. 13, 2020.
- HG.org Legal Resources. "What Happens to an IRA With No Beneficiary Designation?" Accessed Oct. 13, 2020.
Writer Bio
John Csiszar earned a Certified Financial Planner designation and served for 18 years as an investment counselor before becoming a writing and editing contractor for various private clients. In addition to writing thousands of articles for various online publications, he has published five educational books for young adults.