What Does an Executor (or Administrator) Do?
It is an honor to be selected to serve as an executor by a friend or family member and accordingly named in his/her will as the person entrusted with the solemn responsibility for winding up his/her affairs following death. However, it is often also a challenging, time-consuming role requiring sunstantial work for little or no compensation. But after benefiting from his/her lifetime of unselfish devotion as a grandparent, parent, sibilng or friend, having our normal routine disrupted by the duties required of an executor is usually the least we can do to thank the deceased family member or friend.
In a nutshell, an executor is charged with the legal responsibilities for protecting a deceased person's real and personal property until all debts and taxes have been paid, and then seeing that what's left is transferred to the individuals who are entitled to it as beneficiaries under the will.
When there is a duly executed will, the executor gets things started by filing an Application for Probate of Will and Issuance of Letters Testamentary with the appropriate probate court. When the deceased person died without leaving a will, all of the persons who would inherit from the deceased person may agree on the advisability of having an independent administration of the estate, and collectively designate a qualified person, firm or corporation to serve as the independent administrator for the estate. Once appointed by the court to act as the independent administrator, his or her duties are much the same as an executor. (Conversely, any interested person may apply to be appointed as a dependent administrator, and the probate proceedings can proceed under a dependent administration, but this is generally much more lengthy and expensive. A will obviates the necessity for a dependent administration and heirship proceedings).
Venue for a probate proceeding to admit a will to probate or for the granting of letters testamentary or letters of administration is generally the county in which the deceased person resided, if the deceased person (also called the decedent) had a domicile or fixed place of residence within the state of Texas. Other less common situations can be found in the Texas Estates Code for selecting the appropriate venue.
The Texas Estates Code does not require an executor (also called a personal representative) or administrator to be an attorney, accountant, or other person with legal and/or financial degrees or licenses. The Texas Estates Code only states several grounds for disqualification as an executor or administrator, such as incapacity, a felony conviction, or any "person whom the court finds unsuitable." However, the appointment of a person by a probate court in the state of Texas to be an executor or administrator requires the highest degree of honesty, integrity, impartiality and diligence. The probate court will hold the executor or administrator to a fiduciary duty, which is an extraordinary legal standard which requires the executor or administrator to disclose any conflicts of interest, eschew self-dealing, and work diligently and solely in the best interests of and for the benefit of the estate. The executor or administrator is expected under the law to act with utmost good faith and honesty on behlalf of the estate in the discharge of his or her duties.
Executors have a number of responsibilities, depending on the complexity of the deceased person's financial and family circumstances. Typically, an executor must:
- Decide whether or not probate court proceedings are needed. Most jointly owned assets pass to the surviving spouse, without probate. Furthermore, if the deceased person's property (excluding homestead and exempt property) is worth less than $75.,000, it may be able to go through a more streamlined probate process called a Small Estate Affidavit. If a probate proceeding is necessary and there is a will, file the application for probate of will and issuance of letters testamentary with the probate court, obtain a hearing before the judge, and the person named as executor in the will then obtains letters testamentary from the county clerk, giving him or her the official legal authority to act as executor over the estate.
- File the will (if any) in the appropriate probate court. Generally, this step is required by law, even if no probate proceeding will be necessary.
- Identify the decedent's assets and manage them until they are distributed to beneficiaries. This may involve deciding whether to sell real estate or securities owned by the deceased person.
- Handle day-to-day detials. This may include terminating leases and credit cards, and notifying banks, former employers, insurance companies, and government agencies - such as the Social Security Administration, Medicare, and/or the Department of Veterans Affairs - of the death.
- Set up an estate bank account. This account will hold money that is owed to the deceased person, e.g., paychecks or stock dividends.
- Use estate funds to pay continuing expenses. The executor or administrator may need to pay continuing utility bills, mortgage payments, and homeowner's insurance premiums until the estate can be wrapped up.
- Pay debts. If there is a probate proceeding, the executor must officially notify creditors, following the procedure set out by the Texas Estates Code.
- Pay taxes. A final income tax return must be filed, covering the period from the beginning of the tax year to the date of death. State and federal estate tax returns are required only for large estates.
- Determine who inherits the decedent's property. If the deceased person left a will, the will determines the beneficiaries. If there's no will, the person appointed by the probate court to oversee the estate (called the administrator) will have to refer to the "intestate succession" section of the Texas Estates Code to determine the deceased person's heirs. The administrator will need to request an heirship proceeding.
- Supervise the distribution of the deceased person's property. The property will go to the individuals, entities and/or organizations names in the will or those entitled to inherit under the Texas Estates Code.
To learn more about probate proceedings and the executor's responsibilities and obtain step-by-step advice on how to administer and wrap up an estate, please contact our office to arrange a free consultation at (979) 236-8271 or email@example.com. Our office is located at 7 West Way Court, Lake Jackson, Texas 77566.