The death of a loved one is not something for which you can ever prepare. While you may expect it, you are never truly prepared for it. But, knowing what to expect regarding the estate after your loved one dies can help ease the transition and let you focus on the grieving process. The probate process can be a difficult one, so it’s important to know what lies ahead, especially if you are the executor of your loved one’s estate. If you have questions about anything regarding an estate or anything of a financial matter regarding a loved one who’s passed away, you should contact a probate lawyer in your area to schedule a consultation.
What is an executor?
The executor of the estate is the person who is chosen to make all the decisions and handle the closure of the estate. An executor is responsible for using assets to first pay off all debtors and then distributing what’s left to the heirs, as instructed in the will.
Being an executor comes with a lot of responsibility. You must ensure you make decisions in a fair and equal manner, and in accordance with the last wishes of the decedent as laid out in his last will and testament.
It’s important that debtors are paid off first. Debtors may include the IRS, credit card companies, or mortgage companies. Once paying off debtors is complete, the distribution process can begin whereby any and all heirs are paid their share of the leftover estate.
Once all debtors are paid off and all heirs have received their distribution of assets, the probate process can close. However, just because probate has closed, does not mean the executor’s responsibility ends.
Ending Probate Does Not End Liability or Responsibility
An executor’s liability in the probate process lasts even after the close of the estate. That means, if any of the heirs believe you made an unfair or illegal decision in the probate process, they can sue you in an effort to hold you personally liable provided the claim is filed within the statute of limitations. They can even sue your estate after you pass away.
For example, if you sell a decedent’s house for $20,000 under value, and an heir later finds out you sold that house to a friend, he or she can sue you and seek to recover that $20,000 from your personal assets.
In order to limit your liability as the executor of an estate, it is recommended that you do one of two things: (1) get a release of liability or (2) file a formal accounting.
A release of liability is a legal contract signed by all heirs in an estate releasing the executor from any future liability. It is advised that you discuss the signing of the release with the heirs prior to making the final distribution of funds. If the heirs do not agree to sign the release of liability, the second option is filing a formal accounting with the probate court.
If you file a formal accounting with the court, the court will notify all of the heirs and give them a certain amount of time to object to the formal accounting. If none of the heirs object, then the executor is released from liability by the court. If one or more heirs do object, the court will then decide on the appropriate course of action.