The 8 Most Common Mistakes Executors Make…and how to avoid them
Courtesy The Ashmore Law Firm, P.C., North Dallas LIVING WELL Magazine
There are many thankless jobs out there, however one such job that people truly don’t understand until they are thrust into it is the job of an Independent Executor.
As you review or contemplate preparing your Will there are many things you must consider. Although an extremely important part of your Will is to determine who you want to receive your assets, in many instances an even more important consideration that must be made is who to appoint as your Independent Executor. Your Independent Executor is responsible for collecting all of you assets and properly distributing them. Sounds pretty easy, right? WRONG! Below are 8 of the most common mistakes your Independent Executor can make.
1. Filing the wrong Will: Too many times, family members will grab the first Will they find and take that to be “it,” without continuing their search to make sure there isn’t a later dated Will.
2. Failing to correctly identify the property as separate or community property: It is imperative that the Independent Executor correctly identify all of the assets to ensure the proper distribution is made, especially if there’s any potential conflict between any of those who receive assets per your Will.
3. Making distributions too early: Independent Executors have a tendency to want to quickly collect the assets of the estate, make distributions and be done with their job. If distributions are made too early, the Independent Executor could be held personally liable.
4. Failing to use the proper legal notices to creditors: There are legal notices that must be sent out to any creditor of the estate, and if not followed, an Independent Executor could find themselves liable for any financial harm to the estate.
5. Failing to properly identify exempt property: The Independent Executor too often begins paying debts for the estate without understanding there may be some property that is exempt, meaning creditors cannot look to certain property for payment of the debt.
6. Paying creditors too early: Not all creditors are treated equally. Depending on the size of the estate, some creditors may not ever get paid.
7. Failing to properly and timely file the 706 Federal Estate Tax Return: If this occurs, the Independent Executor could be found negligent and held personally liable.
8. Failing to keep beneficiaries informed.
As you can see, when it comes time for you to select who should serve as your Independent Executor, careful thought and consideration must be given. It is a very important job with many moving parts depending on the size of your estate and the type of assets you may have.
The bottom line is to make sure you appoint an Independent Executor who you trust completely and who is responsible. It is also important that your Independent Executor understand their role so that they can retain a qualified probate attorney.
There are many attorneys out there who say they handle probate matters, but as you can see from this article they must have a complete and thorough knowledge of the probate process and the do’s and don’ts of how to represent an Independent Executor.