Usually, when a person dies leaving behind an estate, it can be very overwhelming for the next of kin. Apart from bearing the loss of the loved one, there’s a lot that requires proper management concerning the estate settlement, whether it’s filing for the probate or completing the legal or procedural formalities.
One of the common questions asked during such times is ‘who is left in charge to deal with the assets of a deceased person?’
Well, it’s a fairly simple question to answer, but to understand this, one needs to know multiple other things.
Eligible Representative of an Estate
First and foremost, you should consider two different aspects of this situation:
- whether the person who died has a valid will or
- died intestate, which means without a will.
The former situation is much simpler as the deceased has left a proper manual to deal with his assets. Along with that, the Will also specifies who is eligible to manage the estate. That person is called the executor of the will. Sometimes, there can even be multiple executors who should work in tandem to implement the directions of the will-maker.
However, in the absence of a will and executor, the next of kin manages the estate of the deceased.
How to seek assistance when required?
Although you are the executor of a will or next of kin, you don’t have to sort everything yourself. If you require assistance at any point with the decedent’s estate management, you may:
- Speak with a licensed legal consultant for guidance.
- Hire an attorney
- Or even consult a tax expert in case of a tax issue related to the estate.
The previous tax preparer or financial advisor of the deceased person may be able to provide information and guidance concerning the deceased’s prior financial circumstances. You may have to start dealing with tax debt the deceased accumulated and didn’t pay.
In addition, information about administering a decedent’s estate can be found on the websites of each state’s and territory’s supreme courts and public trustees.
To clarify further, you may get expert advice with:
- General management of a deceased estate
- Contesting a will
- Acquiring letters of administration or even a grant of probate,
- When someone dies without a will. It is called intestate.
Responsibilities of the executor of a will
The first duty of the executor of a Will is to advertise his intent to apply for probate. Following that, he can apply for a grant of probate. Once the court approves the application, a series of duties follow.
Later, the executor must evaluate all the assets and have a list of the valuations. The estate contains:
- Personal effects
- Business interests
- Real estate
- Debts due & owing
More of the executor’s responsibilities are:
- Notify all the listed beneficiaries in the will.
- Prepare statements for each beneficiary.
- Manage the assets left in the Will to:
- take care of any business interests,
- preserve any income,
- invest any unspent funds, and
- insure all property.
- Keep a record of the appraisals for the estate.
- Complete income tax returns and obtain approval from the Australian Taxation Office.
- Pay off any outstanding obligations, including selling assets, if required, to cover any liabilities.
- Make trusting relationships.
The executor of a will supposedly divide the estate as follows:
- Make statements for each beneficiary.
- Allocate cash and/or assets to beneficiaries in conformity with the will’s stipulations.
- If the deceased possessed bank accounts, shares, real estate, or other similar assets in their name, or if they held the real estate as a “tenant in common” with someone else, you may need to file for a grant of probate to settle the estate.
If you are unsure about your obligations, you may seek legal counsel.
Do executors get paid?
The deceased may specify in the Will how much the executor should be paid. If not, the executor is not compensated. However, The Supreme Court may decide to allow the executor of a Will to keep 5% of the estate. This may be paid in lump sum or as a percentage of assets administered.
Does an executor have a deadline to complete the duties?
Extreme caution is required when acting as an executor of a will. Often, 12 months is an acceptable amount of time to complete tasks.
In some cases, it can even go beyond a year.
What if you are named as an executor but do not wish to serve?
When one does not want to act as an executor of a will, they are not required to bear responsibility. It is completely your choice whether or not to take on this responsibility.
In case of declining to serve as executor:
- Another executor, if mentioned in the Will, may assume all responsibilities.
- If no other executor is designated, you may petition the court for the appointment of an administrator.
However, you should know that you cannot alter your mind afterwards.
Administering a deceased’s estate is not an easy task. However, there are also a lot of resources that can help you with the process if you decide to go ahead.