I am the executor of an estate, what do I do first?

On Behalf of | Nov 18, 2021 | Estate Planning |

An executor is a spouse, adult child or legally approved representative that helps guide the distribution of an estate after the owner dies. When this power is triggered, the executor may feel overwhelmed with the amount of work that needs to be done.

Step #1: Get the paperwork in order.

This often begins with copies of the death certificate. Financial institutions will likely need a copy to close out or transfer accounts. You may also need a letter of testamentary for the executor. This is generally issued by the court and establishes that you are the individual with the authority to manage the estate.

Ideally, the estate owner would have put together a will and other estate planning documents that will provide valuable information about the estate and distribution plans. If not, state law will likely guide the process.

Step #2: Organize the estate.

If an inventory is not available, it is generally wise to start one. Get a list of all tangible and intangible assets like real estate, jewelry, vehicles, bank accounts, retirement plans, and life insurance policies. File for any insurance claims, like life or health, as appropriate.

In many cases, this means filing for probate. Estate owners could avoid probate in some situations, such as those that use a trust to help transfer assets.

It is often best to open an estate bank account to manage the funds owed to the estate. This can also help manage the expenses for the estate, as in some cases the executor may need to continue to pay daily expenses like utility bills.

Step #3: Distribute.

Transfer assets that are listed as “payable upon death” to beneficiaries. These can include bank accounts and some securities. If needed, transfer assets held in trusts to the named beneficiaries. Otherwise, once creditors are satisfied the executor can generally begin making distributions as instructed by the will or state law.

Step #4: Close out.

One of the last steps is to file an income tax return for the estate. It is important to note that this is a general guide, a starting place. The exact process varies for each individual estate and could include additional steps like filing for veteran’s or union benefits, transferring royalty rights or dealing with business interests. Legal counsel can review the estate and provide more specific guidance for each situation.