Duties of Executor in an Independent Administration

So, you have agreed to act as the executor (personal representative) of your loved one’s Will. At a hearing before the Court, the judge has ordered that the Will was admitted to probate and that you are appointed to serve as executor. Now, what do you do?

 

• 1. Oath - You have signed an Oath with the probate clerk of the county where the probate was filed. In most cases, if the same person who offered the Will for probate is the person named in the Will to be executor and is the person who appeared in court, the oath will be taken before the clerk on the same day as the hearing. If a bond is required, it will also need to be posted before the letters testamentary are released to you. I will make certain that the requirements are fulfilled in a timely fashion.
• 2. Take possession of all property belonging to the decedent. - The original version of the Will and any codicils have been filed with the Application. Gather all property that was owned by the decedent on the date of death and assert control over it. Any cash that you receive should be kept in a bank or other financial institution in the name of the decedent’s estate; example: “Estate of John Doe.” This account will normally also require that you obtain an “EIN” number from the Internal Revenue Service. (This is a very simple task that can normally be accomplished via telephone or on-line.). You can discuss this with your accountant or other tax preparer to determine if obtaining an EIN number is applicable to the Estate you are handling. Not all possessions need be physical possession; it can be constructive possession, but you need to be sure that you are exercising sufficient control to protect the asset in question. Example: If a relative is living on one of the properties and will continue to do so, you don’t need to have the person evicted so that you can later reinstate the relative. On the other hand, if Joe Renter is living on the property and refuses to vacate even though a relative is waiting to move in and Joe has no other rights to the property, you may be required to have Joe evicted so the directives in the Will can be carried out.
• 3. Notice to General Creditors - Within one (1) month after receiving letters testamentary, a notice to general creditors must be published in accordance with Texas Estates Code §308.051. The notice to general creditors will be done for you by me and the cost for doing so will have simply been made part of filing fees and other out of pocket expenses. In some cases, the personal representative must also send notice to the comptroller of public accounts within one month following appointment. (I will let you know if it applies to the estate that you represent.)
• 4. Notice to specific creditors - Requirements depend upon whether a debt is a secured or unsecured debt. If secured by a mortgage lien, deed of trust, etc., notice must be given to secured creditors via registered or certified mail within four (4) months following your appointment as representative of the estate. (Note: This is a task that may not necessarily be performed by me, so you will need to discuss this with me to be certain that you have fulfilled your duties.) If a debt is “unsecured,” notice is permissive and may be made at any time during the administration of the estate. If there are a large number of unsecured creditors or if the sums owed are large in relation to the overall worth of the estate, you may wish to discuss them with me. I may be able to point out steps that can be taken to shorten the statute of limitations for unsecured creditors and make it safer for you to make final distribution of assets without fear of later-filed lawsuits against the estate.
• 5. Notice to beneficiaries - Pursuant to Texas Estates Code §308.002, within sixty (60) days following your appointment, you must give notice via certified mail to all beneficiaries of the filing of the Will for probate, and you must provide them with a copy of the Will. Within ninety (90) days, an affidavit of compliance must be filed with the Court to show that this has been done. This notice of compliance will normally be prepared for your signature and then filed by me, based upon information that you have given me. (If you are in doubt, be sure to ask me about this duty.)
• 6. Inventory - Within ninety (90) days following appointment, the executor must file a fully verified and sworn inventory with the clerk of the court which must include a detailed listing of all real property, all personal property and all claims that the estate may have against other persons or entities. I will prepare this Inventory from the information you have or will give me. After you review it for accuracy, I will file it with the court in your behalf.
• 7. Governmental beneficiaries- Executors need to be aware of a short time limit in which to notify charitable organizations, the state of Texas or any governmental unit if they have been named as beneficiaries under the Will. This notice must be sent via registered or certified mail, together with a copy of the Will, not later than thirty (30) days following admission of the Will to probate.
• 8. Taxes-
  
  Individual Return – If the decedent’s income during the year of his/her death was great enough to require filing of a federal income tax return, that return should be filed to either pay taxes due or to collect refunds.
  
  Federal Estate Tax Return - If the decedent’s estate exceeded the federal tax exemption at the time of death, then both a federal and state tax return will need to be filed. Before determining this amount, be sure to speak with a tax professional to determine if there is any necessity to file a return on the matter you are handling.

   

  If, after the death of the decedent, the estate itself continues to produce income, then a fiduciary income tax return of the estate may become due.
• 9. Other IRS notices- If the estate will be subject of a fiduciary income tax return as discussed above, you will be under a duty to file a “Notice Concerning Fiduciary Relationship” (IRS form 56) as quickly as possible along with the application for EIN number previously discussed.
• 10. Transfers of Property - Finally, after all debts have been settled or paid, you are ready to distribute the remaining property to the beneficiaries as described in the Will. You will need to look to the Will for instruction in this regard. If the Will specifies that property may be distributed in “money” only, then you will need to liquidate the assets and distribute the funds in the percentages dictated. If the Will allows you to distribute the property “in money or in kind,” then (within the authority given) you will pass title to property of the estate. The letters testamentary issued to you by the court will give you the authority to act with the decedent’s property just as he/she could have for the purposes of following the instruction in the Will. Title does not pass automatically just because you are the executor; you must still prepare and execute documents of transfer. Although transfer documents are not usually prepared as a matter of course by most probate attorneys as a necessary part of the probate, they are available through me for an additional nominal cost.

Most of the duties described on the above list can be accomplished with very little effort and within a relatively short time period. I will advise you about these issues and give you advice on what will be required by you as you perform the duties of your appointment.