What Does an Executor of an Estate Do?

Only 32% of adults have a will, and many name an executor without discussing it first. Only 46% of executors who are named executors of the estate are aware that they are given that role. 

Being an estate executor is a significant responsibility that involves various legal and financial tasks such as locating and validating the will, identifying and valuing assets, paying debts, filing taxes, and distributing property to heirs. It’s a complex process that can take months to complete. 

Whether you’ve been named an executor or are choosing one, it’s crucial to understand the role. In this guide, we’ll walk you through the key duties of an executor and provide tips for navigating the estate settlement process with confidence and care.

What Does an Executor of a Will Do?

An executor of a will is responsible for managing and distributing the assets of a deceased person’s estate according to their final wishes. The executor’s duties include locating and validating the will, initiating the probate process, identifying and inventorying assets and debts, paying outstanding bills and taxes, and distributing remaining assets to beneficiaries. They must also close accounts, notify relevant parties, and handle any legal issues that arise. 

The executor plays a critical role in ensuring that the estate is settled efficiently, legally, and in accordance with the deceased’s instructions. This complex and time-consuming process requires organization, attention to detail, and a commitment to acting in the best interests of the estate and its beneficiaries. 

Ultimately, the executor serves as a final act of love and responsibility, honoring the legacy of the deceased and providing closure for those left behind.

First Steps After Death for an Executor of Estate

After a loved one passes away, the executor named in the will must take immediate action to initiate the estate settlement process. This most often begins with locating and validating the will, initiating the probate process, and seeking professional guidance from an estate attorney and certified public accountant (CPA). 

These initial actions lay the groundwork for the complex tasks ahead and ensure that the executor is operating with the proper authority and expertise to carry out their duties effectively.

Locating and Validating the Will

The first crucial step for an executor is to locate the deceased person’s will if there is one. This may be incredibly difficult as most adult children of deceased parents (52%) don’t know where their parents keep their estate planning documents.

Estate planning documents may be stored in a safe deposit box, filed with an attorney, or kept among important papers at home. Once found, the executor must confirm that it is the most recent, valid version and properly signed and witnessed. 

If there is no will, the deceased is said to have died “intestate,” and state law will determine how the assets are distributed. Like an executor, the probate court will appoint an administrator to oversee the process.

Initiating the Probate Process

Probate is the legal process of executing a will and settling an estate. The executor must file the will and a petition for probate with the appropriate court, usually in the county where the deceased lived. A probate court will then issue “letters testamentary,” which authorize the executor to act on behalf of the estate.

The length and complexity of probate can vary widely depending on the size of the estate and whether there are any disputes. In some cases, probate may be avoided entirely if the estate is small or assets are held in trusts.

Getting Professional Help

Serving as an executor can quickly become overwhelming, especially for large or complicated estates. That’s why it’s often wise to enlist professional help:

• An experienced estate attorney can guide you through the legal process, help interpret the will, and represent the estate in court if necessary. 
• A certified public accountant (CPA) can assist with filing tax returns, obtaining appraisals, and ensuring the estate is divided properly among beneficiaries.

While professional fees will come out of the estate, getting expert advice can save the executor time and stress and help avoid costly mistakes.

An Exucetor’s Role in Inventorying Assets and Debts 

As an executor, you play a critical role in compiling a comprehensive inventory of the deceased’s assets and debts to settle the estate. This involves identifying and securing all assets, determining their values for tax and distribution purposes, and compiling a list of outstanding debts owed by the deceased. Thoroughness and organization are key to ensuring the efficient administration of the estate.

Identifying All Assets

One of an executor’s key duties is to identify and secure all assets that belonged to the deceased. This can be a complex and time-consuming, especially if the deceased did not leave clear records. Assets may include:

• Bank accounts and investments
• Real estate 
• Vehicles
• Personal possessions and collectibles
• Life insurance policies
• Business interests

The executor must protect these assets by changing locks on properties, securely storing valuables, and notifying financial institutions of the death.

Determining Date of Death Values  

For tax and distribution purposes, the executor must determine the value of all assets as of the date of death. This may require appraisals of real estate, collectibles, or other items. 

The executor will also need to obtain statements showing the balance of bank and investment accounts on the date of death. For listed securities like stocks, the executor can typically use the average high and low prices on the date of death.

Keeping careful records of all valuations is crucial, as this information will be needed for the estate tax return and to ensure each beneficiary receives their proper share.

Compiling a List of Debts

In addition to assets, the estate executor must identify all outstanding debts the deceased owes. These may include:

• Mortgages and car loans
• Credit card balances
• Medical bills
• Household expenses

The executor should gather statements from creditors showing balances owed. Sometimes, an executor may need to publish a notice to creditors in a local newspaper to ensure all debts are accounted for. 

Valid debts must be paid out of estate assets before any distributions to heirs.

Handling Financial Matters

During the estate settlement process, the executor handles financial responsibilities like paying bills, notifying creditors, and filing tax returns. Once debts and taxes are settled, the remaining assets are distributed to beneficiaries according to the will or state law. Meticulous record-keeping is crucial throughout this process.

Paying Ongoing Bills

As an executor, you ensure the deceased person’s ongoing bills are paid until the estate is settled. This may include:

• Mortgage or rent payments
• Utility bills
• Insurance premiums
• Property maintenance costs

It’s important to keep detailed records of all bills paid and where the funds came from. The executor can typically open a bank account in the estate’s name to handle these transactions.

Notifying Creditors

Part of an executor’s role is notifying any creditors of the death and settling valid debts. Steps include:

• Publishing a notice to creditors in a local newspaper to alert them to submit claims 
• Sending written notice to known creditors
• Reviewing claims to determine validity 
• Paying valid claims in order of priority set by state law

If there are more debts than assets to pay them, the estate is considered insolvent and the executor must follow careful procedures to determine who gets paid first.

Filing Tax Returns

The executor is responsible for filing various tax returns on behalf of the deceased and the estate, including:

• The deceased person’s final federal and state income tax returns
• Federal and state estate tax returns (for estates over a certain value)
• Estate income tax returns if the estate generates income

Working with a CPA is highly recommended to handle all tax liabilities properly. Executors can be personally liable for unpaid taxes, so it’s not a task to take lightly.

Distributing Assets to Beneficiaries

Once all debts and taxes are paid, the estate executor can distribute the remaining assets to beneficiaries. This involves:

• Following the instructions in the will (or state law if there is no will)  
• Obtaining signed releases from beneficiaries acknowledging receipt of assets
• Keeping detailed records of what assets were distributed to whom

If the will calls for assets to be placed in a trust, the executor must work with an attorney to ensure the trust is properly funded and managed.

Closing Accounts and Wrapping Up  

After settling all debts, distributing assets, and resolving legal matters, the executor must notify relevant parties of the death and the closure of the estate. This includes government agencies, pension providers, financial institutions, and utility companies. 

The executor must also close any remaining accounts in the deceased’s name to prevent identity theft and additional fees. Finally, they are responsible for distributing any remaining personal effects among beneficiaries.

Notifying Relevant Parties

Upon settling all estate matters, the executor must notify various parties of the death and that the estate is closed. This may include:

• Social Security Administration
• Pension providers
• Department of Veterans Affairs
• Post office
• Utility companies
• Financial institutions  

The executor should keep copies of all notification letters and responses received.  

Closing Accounts

The estate executor should also close out any remaining accounts in the deceased’s name, such as:

• Bank accounts 
• Credit cards
• Investment accounts
• Even social media profiles