Dealing with a loved one’s death is one of the hardest things you ever have to do in your life. With the added responsibility of being the executor of your parent’s estate, it’s natural to feel overwhelmed. It’s very difficult to cope with grief and keep up with your responsibilities as an executor at the same time, but keep in mind that you were given that responsibility for a reason.
To help you in this trying time, here are some things that you should know as an executor of your parent’s estate.
#1 – Seek professional help if you need to.
Many executors who want to keep costs low do all the work on their own, but if your parent’s estate is quite substantial, it’s much better to seek the help of a lawyer and an accountant to do some of the work for you. If you are not well versed with the legal technicalities involved in the process, a lawyer can advise and guide you every step of the way. An accountant, on the other hand, can help you with the preparation and filing of all the necessary tax returns and estate accounts. In some cases, forgoing professional help can actually cost the estate more money. So if you think that you’re not capable of doing everything on your own, don’t be such a cheapskate and ask for professional assistance.
#2 – Set your personal agendas aside.
As a beneficiary yourself, you may want to maximize the amount that you will receive from your parent’s estate. However, you must always remember that as an executor, you can’t do anything that would benefit yourself more in an expense of the other parties involved.
#3 – Never treat the estate money as your own.
As an executor, it is very important that all estate assets are separate from all your other assets. You must never use the estate funds to pay off your own debt, or acquire new ventures and properties. Unauthorized use of estate funds is illegal and you may be forced to repay the funds you spent out of your own pocket. It’s best to open a separate account as it is more transparent, should anyone question your administration of the estate.
#4 – Communicate regularly.
If your co-beneficiaries and other interested parties can’t get the information that they are entitled to, then this will lead to suspicion, or worse, a possible litigation. You must respond to any inquiries and give regular updates to your co-beneficiaries if there’s any.
#5 – Pay off all debts and taxes before distributing money.
Misunderstandings on how and when the estate should be divided can easily turn into a feud, so as an executor, it can be difficult to resist the pressure from those who want to get their money immediately. However, it is very important that you settle all debts and tax liabilities first before distributing each co-beneficiary’s share. Failure to do so can make you personally liable for paying those debts.
Being tasked as an executor of your parent’s estate is a huge responsibility, but as long as you’re organized and you know the things that you should watch out for, then things should go pretty smoothly.