When it comes to Estate Planning and Probate, many people have very little knowledge of the common process. Sure, they know a little bit because someone told them, but Probate and Estate Planning are not usually taught in school, which is a shame because these are things that most of us will go through at some point in our lives.
There is usually a lot of confusion around what an Executor does, and what they receive. Many people think that the Executor is the person who will receive all the benefits and assets of an estate. But this is far from true. So, can the Executor of a Will take everything? Usually not, but it’s not uncommon for the Executor of a Will to also be a beneficiary, but usually they don’t receive everything.
What is an Executor?
The Executor of an estate is somebody appointed by either the Will maker or by the court to manage the deceased person’s estate. This person is in charge of all assets and carrying out the wishes of the deceased person as written in their Will. This person must deal with all 3rd parties, including beneficiaries, accountants, and most importantly the court.
Executors are either appointed by the deceased person that made their Will or by the court. Usually when someone makes a Will or a Trust, it is necessary for them to choose an Executor, someone they can trust to make sure their wishes are kept and that their estate is in safe hands. When someone dies without a Will or dies with no Executor indicated in their Will, an Executor will be appointed by a judge in the Probate court process. States usually have guidelines that list which relatives are eligible and the order of preference.
Executor – Someone that is appointed by either the Will maker or the court to manage the deceased person’s estate.
Beneficiary – A person named in a Will, that will inherit part of the benefit of a deceased person’s estate.
Duties of the Executor
- Making an inventory of all assets
- Communicate with all beneficiaries, accountants, and other parties involved
- Calculating the value of the estate
- Settling debts on the estate
- Selling/transferring property or investments
Example – John is recently deceased. 5 years before John died, he went to an Estate Planning lawyer to write a Will. The Estate Planning lawyer told him he needed to assign an Executor, someone he trusted to make sure his house, car, boat, cash, and other assets were transferred to his loved ones. John chose his brother Ted.
After John passed away, John’s family entered the Probate court process. Since Ted was the Executor, he was in charge of transferring John’s funds to his children’s bank accounts, dealing with accountants and professionals, and making sure John’s last wishes are kept.
Probate Process
Probate is the legal process of settling an estate at the time of one’s death. The first step in the process is to file the Last Will and Testament to the Probate court. They will usually schedule a court hearing after this to determine the validity of the Will and determine or approve the Executor. Beneficiaries and family members will be noticed and given the opportunity to appear and contest the proposed course of action. Once the Executor is appointed, he/she will begin to gather assets and notify creditors of the death. They will have to file an inventory of all assets in the estate. Within 8 – 18 months the Executor will be ready to close the estate and present a proposed accounting list offering all assets and who will receive them. At this point, interested parties must appear in court and approve the plan.
Can the Executor Take Everything?
Now that you know a little bit more about the Probate process you might be able to guess that the Executor cannot keep everything. The Executor has no right in taking everything unless that is what is written in the Will. It is very rare that a person writes a Will appointing an Executor and leaves everything in their name as well. But being an Executor as well as partial beneficiary is not uncommon.
The Executor cannot do anything that goes against what is clearly written in the Will. The Executor also cannot act upon the estate prior to being appointed by the court. The Executor must treat the deceased persons’ assets as if they were their own, so they cannot sell anything below fair market value, unless agreed upon by the beneficiaries. Changes cannot be made to the Will by the executor or anyone else. If any of these things are broken, or if anyone believes the Executor is not managing the estate properly, they have the right to file a petition for the removal of the Executor. Serious violations in the management of an estate could result in a civil lawsuit.
