Who Should I Name as My Executor?
When you write your will, one of the things you do is identify the person or persons you name as your executor. The executor acts as a representative of your estate, carries out the wishes you have expressed in your will, pays the debts and obligations of the estate, and distributes assets to your beneficiaries – the persons you designated in your will to receive them.
Duties of the Executor
The executor is responsible for collecting and preserving the assets of your estate and preparing an inventory. This can include bank accounts, personal property, real estate, stocks, bonds, and more. The executor also pays any debts owed by your estate, including household and medical bills. The executor also files an estate tax return, and pays estate taxes out of the estate’s assets. Notably, paying the debts of your estate may require your executor to sell some assets before he or she can distribute the remaining assets to your beneficiaries—oftentimes there is not enough cash on hand.
The executor also represents your estate if there are claims against it, or if your estate has claims against others. For example, if there is a lawsuit against you at the time of your death, the executor would step into your shoes, and represent the interests of your estate in the lawsuit.
If your estate is complex, specialized knowledge may be needed. For instance, if your estate includes real estate in more than one state, and/or if you owned your own business, your executor may need to hire financial or legal help.
Choosing Your Executor
The executor’s job is extremely important, but it can be difficult and involve a lot of paperwork. It requires patience and persistence to deal with medical bills, and impatient relatives. It is important to choose someone that can handle such matters.
Most importantly, your executor should be someone who you trust to carry out your wishes. He/she should have the utmost integrity and should be organized and financially responsible. Consider your executor’s health and other factors, which may hamper his/her ability to carry out their duties as executor. Additionally, since many of the executor’s duties may need to be performed where your assets are located, choosing an executor who lives close is a good idea, since an executor’s travel costs can reduce the size of the estate and delay distribution of the assets.
Many people choose a trusted family member or friend to serve as their executor. Your executor is entitled to receive a fee, but often, family members or friends named as executors waive the fee to keep the money within the estate. If you are considering naming someone as an executor who is also a beneficiary of your estate, consider the potential conflict of interest which may arise. For example, if you name one child as your executor, it may cause friction between that child and his or her siblings if they think the child who is the executor is not handling the estate properly. If you decide to name co-executors, these conflicts may be intensified. If they cannot work together, it can lead to more conflict and may result in court intervention, which can be expensive and time-consuming.
Although your executor is generally authorized to get outside help and pay for it out of the assets of the estate, this reduces the amount available to distribute to the beneficiaries. That said, you may want to choose a disinterested, paid executor such as a bank or lawyer who may be more impartial, have specialized knowledge, have the ability to deal with complex legal and financial issues, and reduce friction between family members and other beneficiaries.
Notifying the Executor
Before naming someone as your executor, you should discuss it with the person first to ensure that he/she is willing to serve in that role. The person designated as the executor has the option to decline the appointment, and if he or she does so, the court may appoint an executor who you would not have entrusted with that responsibility. You should also consider appointing a successor or backup executor in event the person you originally designated is unable to serve due to a change in circumstances before or after your death.
Use our site to find an estate planning lawyer who can help you decide who to name as the executor of your will and who can help you draft your will and estate plan.
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