Serving as an Executor

[Purron]

A friend of mine has asked me to serve as her executor. She is 62 and rents an apartment. Her only assets are her car, savings account, and the contents of her condo. Her income consists of a small pension and social security. She has no family unless you count her 2 cats. Her will would provide $5,000 to care for and place her cats. Since I'm active in the rescue community, I'm not too worried about this.

I'm inclined to agree but am concerned because I've heard serving as an executor can create liability. I'm not too worried about the paperwork because of my accounting background.

I told her I would think it over. I'm meeting her next Tuesday to discuss this in more detail. Any input or advice would be much appreciated, particularly from those of you who have been through this before.

[Walt34]

I was executor of my mother's estate. Acting as one does not create a liability for you unless you pay bills from the estate's funds in an incorrect order. For example, if she has outstanding credit card bills and a car loan and you pay the CC bills first (unsecured debt) without leaving enough to pay the car loan (secured debt) then you may be liable for the difference.

Most attorneys will charge little to nothing for a half-hour talk about this and there are many books on the subject. Essentially it's a matter of using the estate's funds to pay off any remaining obligations, then distributing the remainder according to the instructions in the will. If the remainder will not cover all outstanding debts then the lenders will ultimately eat the loss, but the order in which they take losses can be important.

Your friend's situation sounds pretty simple.

[twaddle]

I'm currently acting as administrator for an estate. My understanding is that your personal liability can come from both creditors and (unhappy) beneficiaries.

The burden isn't huge, but I need to prepare three tax returns (the estate becomes an independent entity during settlement, and if the deceased hired care givers, things can get complicated).

And in my case, I have to deal with out-of-state banks who haven't been very cooperative. Insurance companies likewise.

Bottom-line: I wouldn't do it except for a very good friend or family member, or to protect the beneficiary.

[SteveR]

I am the executor and trustee for my late wife's estate. I was the co-executor for my father's estate and currently handle my mother's finances. The biggest task I had was getting the estate taxes filed before the deadline and getting all the account names changed. I am still working on some issues almost 4 years later.

The trust has to file income taxes each year. Other than that and keeping the accounts apart from mine it is not all that much work. It sounds like the estate you would be the executor for is pretty simple so I would not sweat it. Do some reading on estate tax requirements so you don't miss any deadlines and you should be fine.

[Martha]

With such a small estate, I don't think it would be a very big deal. You might have to file an income tax return but it isn't rocket science. I was executor for my father's, grandfather's, and father in law's estates and it wasn't tough and I wasn't a lawyer when I did dad's and grandpa's estates. I am also named as executor for a few friends and clients.

[Nords]

Quote:

Originally Posted by Purron A friend of mine has asked me to serve as her executor. She is 62 and rents an apartment. Her only assets are her car, savings account, and the contents of her condo. Her income consists of a small pension and social security. She has no family unless you count her 2 cats. Her will would provide $5,000 to care for and place her cats. Since I'm active in the rescue community, I'm not too worried about this.

My impression is that if someone wants to avenge themselves upon you from beyond the grave, they make you their executor. You'll have to ask her why she's trying to ruin a beautiful friendship with fiduciary responsibilities...

She should be able to give you a copy of the will, explain whatever's not in the will via a letter or statement, and give you a list of where to find all the important papers. Maybe the two of you could read a book on wills & estate planning and make sure that all of the book's issues are accounted for in her paperwork.

When you record the probate paperwork, undoubtedly you'll find that she had family neither of you ever knew existed...

[calmloki]

Was executor of my Mom's estate. Both brother and sister were very accomodating and it was still a pain in the rear. She died on the last day of the year and i ended up doing 3 years of taxes and hassling with various financial institutions that couldn't talk to me until they got death certificate, copy of will naming me executor, statement from lawyer/judge attesting that i was executor.... plus the in-house paperwork that they felt was necessary.

[Meadbh]

Been there, done that. If the executor and the testee reside in the same jurisdiction, if the will is clear, if the records are accessible and well kept, if there are no feuding heirs, and if the estate is insufficient to warrant probate, it shouldn't be a problem. Otherwise it can be a PITA. So I would try to ensure the above conditions, and would offer to be an executor only for a good friend.

[W2R]

Quote:

Originally Posted by Nords My impression is that if someone wants to avenge themselves upon you from beyond the grave, they make you their executor. You'll have to ask her why she's trying to ruin a beautiful friendship with fiduciary responsibilities...

That's funny, but like many funny observations, it has a grain of truth.

My poor brother. He's executor of my mother's uncontested estate, which has been a pain in the neck and unfortunately neither easy nor simple. Luckily he is a CPA, and he has a lawyer helping him. The lawyer told him at the start that it would take 6-12 months, and it has only been 4 months, so we expected it to take a while. Thank goodness she had no real estate to dispose of.

Being an executor can be prolonged and draining, depending on the estate. I can only think of three people I would do that for if asked.

[Martha]

Interesting to read these comments, with mine being one of the few positive comments. What some people find to be a pain in the neck, I find interesting and when it is done, a sense of accomplishment. A little like cleaning and organizing the house. But with the feeling of honoring the person who died.

[REWahoo]

Quote:

Originally Posted by Martha What some people find to be a pain in the neck, I find interesting and when it is done, a sense of accomplishment. A little like cleaning and organizing the house.

Or being a moderator...

[Martha]

Quote:

Originally Posted by REWahoo Or being a moderator...

Ha!

[HFWR]

Quote:

Originally Posted by REWahoo Or being a moderator...

Nah, that's more like driving the "sewer-sucking" truck...

"Ah, here they come, here they come...............the $hit detail."

From Woodstock

[Purron]

Quote:

Originally Posted by Martha Interesting to read these comments, with mine being one of the few positive comments. What some people find to be a pain in the neck, I find interesting and when it is done, a sense of accomplishment. A little like cleaning and organizing the house. But with the feeling of honoring the person who died.

I appreciate all the comments, both positive and negative. I think I will agree to help my friend and have come up with some questions for her as a result of your comments.

[TromboneAl]

Quote:

Originally Posted by Martha Interesting to read these comments, with mine being one of the few positive comments. What some people find to be a pain in the neck, I find interesting and when it is done, a sense of accomplishment. A little like cleaning and organizing the house. But with the feeling of honoring the person who died.

Will you be my executor, Martha?

[Martha]

Quote:

Originally Posted by TromboneAl Will you be my executor, Martha?

Can't. You are going to out live me with your 6 day a week exercise program and weight watching abilities.

[FinanceDude]

Quote:

Originally Posted by Martha Can't. You are going to out live me with you 6 day a week exercise program and weight watching abilities.

I think Trombone Al and a few others will outlive ALL of us...........

[Achiever51]

My DH was asked by his aunt to be the executor of her will and he agreed. She had few assets, no real estate, had never married and the entire estate was worth maybe $50,000.

After she died, everything was proceeding as she wished until an out of state relative (a niece who hadn't even seen her for years), wrote to the probate court claiming that there were other assets (like a full length sable coat and important jewelry -- none of which was true)-- and implying that my DH was somehow hiding them (also not true).

Then my DH's step-mother-in-law -- the aunt's sister-in-law -- also from out of state claimed to find an insurance policy naming her deceased husband, the aunt's brother, as beneficiary and she was claiming ownership. Apparently this insurance policy (which was valued at less than $10,000) was not listed on any of the estate documents.

After nearly three years of meetings, letters, depositions and legal fees, to say nothing of the stress he was experiencing as a result, DH resigned the position of executor. It's now been nearly five years since his aunt died, and the estate still has not been settled and is still tied up in probate. Last we heard was that one of the out of state relatives filed suit against the attorney named as the replacement executor. Can't imagine that there will be much left in the estate after all the legal fees are finally paid.

All in all a mess. And it seemed so simple at the beginning. DH had met with his aunt and the attorney who drew up the will; thought all was in order, etc.

[Meadbh]

Quote:

Originally Posted by Martha Interesting to read these comments, with mine being one of the few positive comments. What some people find to be a pain in the neck, I find interesting and when it is done, a sense of accomplishment. A little like cleaning and organizing the house. But with the feeling of honoring the person who died.

But Martha....you're a lawyer with a whip!

[lazygood4nothinbum]

reading mom's will. this is probably typical paragraph but just so you should know:

"i direct that the personal rep of my estate shall not be required to furnish a bond unless required by law or court rule...the personal rep...shall not be required to furnish a surety bond."

also

"the personal rep & trustee hereunder shall not be liable for the acts, ommissions or defaults of any agent appointed with due care, and it shall be held to no obligation whatever under the terms of this agreement except for the exercise of good faith and ordinary diligence in the discharge of those duties..."