Serving as the executor of an estate or the administrator of a trust carries significant responsibilities. When those responsibilities are improperly handled, legal action can be taken against an executor or administrator. Therefore, before agreeing to serve in this position, an individual should fully understand what it entails.
An estate executor and trust administrator are fiduciaries, which means that they must make decisions that further the best interests of the estate or trust. The first step in this process is to assume control of, inventory, and evaluate, all assets at hand. This may sound like an easy enough process, but it can actually be quite challenging. Some accounts may require a certain type of letter from the court along with a birth certificate, and professional appraisers may need to be hired to provide a clear and accurate assessment of assets’ value.
Even though this inventory, along with values, must be submitted to the court, that is just the beginning of the process. An estate executor or trust administrator may also have to pay debts from the assets in hand. If not paid in a timely fashion, these debts can accumulate penalties and interest that eat into the estate’s value. Taxes must also be paid. Only then can an executor or administrator look at asset distribution and investment. This, too, must be handled carefully, as any missteps could result in harm to the estate or trust’s value and legal action for breach of fiduciary duty.
Choosing someone to act as an estate executor or trust administrator can be challenging in its own right, but those who are tasked with this duty have a lot to live up to. Regardless of which end of this process an individual finds him or herself on, it is probably best to work closely with a skilled estate planning and probate attorney to ensure everything is handled in accordance with the law.