When you are appointed executor, it is your job to organize the assets, the debts, and the taxes associated with the estate over which you have been given charge.
As executor of an estate, you are responsible for settling all of the decedent’s final affairs. You are not required to have any special degree or knowledge about estates and finances or to be a legal expert, however, the position requires someone who is organized, level-headed, impartial, patient, and honest. It is your legal duty to act in the best interest of the recipients and you will need support along the way. This is not always a straightforward process but with the help of a lawyer from Chamlin, Uliano, & Walsh, you can ensure that a loved one’s affairs are handled appropriately and move things in the process along much more smoothly.
What Is an Executor’s Role?
An executor has the power to oversee and manage the finances and property of the decedent. In accordance with the will, the executor distributes the inheritance to the beneficiaries and assures payment of all debts and obligations of the estate.
Can an Executor Also Be A Beneficiary?
Frequently, executors are spouses or family of the deceased and although one may consider it to be a conflict of interest, all transactions are transparent and can be viewed at any time. The executor is bound by what is called a fiduciary duty. If you, as a beneficiary, suspect that the executor is commingling funds or acting in a way that is to the detriment of the estate, you need to contact an attorney forthwith.
To Do List for an Estate Executor in New Jersey
#1. The first step is to take the will with the death certificate to be admitted to probate and receive a document called Letters Testamentary which permits the estate to be settled by you.
#2. Secondly, you must contact all heirs, beneficiaries, or potential heirs to inform them of their relative’s passing. Just because a relative is not named in the will does not necessarily mean they can’t receive some inheritance.
#3. Contact the IRS for an estate tax number to replace the decedent’s social security number which can no longer be used. An estate checking account should be opened in the name of the estate. Next, an inventory of all of the assets and property belonging to the estate is compiled, along with a list of all debts and financial obligations.
#4. The estate must be determined to be solvent or insolvent. A solvent estate is able to meet all financial obligations and pay all debts. An insolvent estate owes more than what is available in assets. This does not absolve the estate from having to pay what is owed. The executor is required to fill out an application with the court and set up a payment plan for as many creditors as possible.
#5. When you are the executor of a will, you cannot become personally responsible for the debts of the decedent. You must take care to neither receive nor pay funds that belong to the estate. It is vital that you speak with an attorney regarding the consequences of what would happen within a solvent estate to avoid any personal responsibility.
#6. Next, all assets need to be inventoried and appraised. This may require you to contact professionals such as brokers, real estate agents, or collection specialists to determine the value of the assets.
#7. Once you have a solid number in the way of assets, it is time to pay credit card debt, loans, and any other outstanding bills. You also must pay the property taxes to the state of New Jersey owned by the estate. Once this has happened, the estate is removed from any tax lien by means of a document called a tax waiver, which will be needed if the sale of the property is forthcoming. Federal taxes are still owed as are Inheritance taxes, both of which must be paid between 9 and 8 months respectively. You can be held liable for unpaid taxes if the distribution of benefits takes place before the tax bills are paid.
#8. When everything has been paid, it is time to distribute what is left in accordance with the will. The executor should require each beneficiary to sign a Refunding Bond and Release for the amount they received in order to avoid liability for claims made in the future. The fees paid for the executor should be paid before the distribution takes place. For an estate valued at up to $200,000, the executor’s fee is 5%, from $200,001 to $1,000,000 it is 3.5% and anything greater is 2%.
#9. Lastly, the property must be transferred from the deceased to the beneficiary which is called a transfer of title.
Do I Need a NJ Estate Attorney?
Are you an executor for the estate of a dear one? Very few people are as knowledgeable as an attorney of probate law. This is not a trial-and-error arena and while processing your own grief, overseeing an estate and its financial affairs can be overwhelming. Don’t let the stress and worry of the present moment cause you angst and concern. There is help available to support and guide you as you make the necessary decisions to process the will and financially settle the estate. At Chamlin, Uliano & Walsh, we have the skills to work with you step by step in processing the estate as executor.
Our experienced legal team is ready to provide knowledgeable advice that will give you confidence at the hour of closing the financial chapter of the estate. Contact us online or call our office at (732) 440-3950 today for a confidential consultation to begin the process of executing the will of someone near and dear to you. We provide legal representation to clients and families throughout Monmouth County, including in Asbury Park, Deal, Belmar, Holmdel, Eatontown, Howell, and Freehold.