The grief and emotional trauma are already enough to deal with. But if someone close to you has passed and you are responsible for the estate administration, you will have much more to deal with. And most of it is highly involved and legally complex – and the attached responsibility can seem overwhelming.
Estate administration generally has three parts: 1) collection, inventory, and appraisal of assets, 2) payment of debts and taxes, and 3) distribution of remaining assets to designated beneficiaries. Owing to all the legal intricacies and the huge responsibility, it is usually advisable to seek experienced legal counsel for administering an estate and not to attempt it all on your own.
Typically, the decedent’s state of residence at the time if death is the state in which estate administration will occur. But in certain instances, the estate may have to be administered in another state (or more) as well. If for example, the decedent owned real estate in another state, an ancillary proceeding may be necessary to probate that property in the state where it is located.
In addition, a probate proceeding is often required – if, say, a will is disputed – and it can be long and complex and anxiety-inducing. A formal probate proceeding involves court oversight, usually with one or more court hearings. In some fortunate cases, it can start out formally, but after the court appoints a personal representative, it ends informally, which involves just the filing of a document detailing the distribution of assets.
Serving as a personal representative or executor can be an honor, but it also entails enormous responsibility. The person appointed has the responsibility of making sure the decedent’s last wishes are carried out exactly as specified with respect to the disposition of property, possessions, and other assets. Basically, it means paying off debt and creditors and distributing remaining property and/or money to beneficiaries.
The personal representative or executor is also legally bound to exercise the highest diligence and honesty in the performance of duties. The legal term for this is “fiduciary duty” and requires the executor to act in good faith in executing the wishes expressed in the decedent’s will. While the executor is not entitled to proceeds from the sale of estate property, she does generally receive a “reasonable” compensatory fee for administration duties.
The first step in actual estate administration is the documenting of all the decedent’s assets – the inventory. Next, the personal representative/executor must notify creditors of the decedent’s death. Then, if the probate assets are sufficient, the personal representative/executor will pay off these debts from the estate. If, however, assets are insufficient, court approval may be needed in order to determine exactly which creditors should be paid.
After debts and creditors have been seen to, the next step involves distributing the remaining assets in exact accordance with the will. And if the decedent left no will – that is, died intestate – the laws of the state where the decedent resided will determine how assets are to be distributed.
Further, the personal representative/executor will have to file any necessary tax returns. And it may turn out that, if the estate is owed money, she may have to bring a lawsuit to collect.
Don’t let your debts become debts for your heirs. Solid estate planning is that important. The experienced attorneys at Legacy Law Group of Northern Virginia can help you protect your assets, your beneficiaries, your heirs, and your family. Contact us for more information by calling (703) 492-9955 or by filling out the online form.