Estate administration or serving as the executor of someone’s estate is a difficult and often thankless job that can require months of unpaid work, detailed record-keeping and double-checking. Given how detail-oriented estate administration is, it is not surprising that quite a few people struggle with handling the process and can make mistakes.
Don’t let intimidation over what you have to do slow you into inaction. Failing to handle things in a timely manner is one common mistake. Learning what the most common estate administration mistakes are before you begin your duties as an executor could help you avoid falling victim to those common mistakes.
Distributing assets before handling outstanding debts
Unless your deceased friend or family member have their affairs perfectly in order at the time of their death, you will likely need to go through the process of dependent estate administration. It is called dependent because the courts will play a more active role in the process because of conflict among beneficiaries or complex debts that must get paid on behalf of the deceased.
While you may assume that there are more than enough assets to cover those debts and more, distributing anything from the estate to people without settling the debts first is one of the most basic mistakes executors make. If there aren’t enough assets left to settle debts and pay taxes, you could be liable.
Letting emotions dictate actions
Do you feel bad for a member of the family who isn’t getting as much of an inheritance as other people? Do you secretly hope to sway the process in the favor of a specific individual? Taking action for your own motivation could put you at risk.
Your role is to act in the best interest of the estate itself and to follow the specific instructions left behind by the testator. Any deviation from the written estate plan or obvious bias could lead to a challenge against you as the administrator.
Making assumptions when it comes to terms or assets
Whether you need to place a value on a painting or interpret a confusing clause in the estate plan, you don’t want to make an assumption without proper guidance and advice. Consulting with a lawyer, potentially even the lawyer who helped draft the will, can help you make sense of the requests made by the deceased. In the event that you need to place a value on significant assets, working with professional appraisers can help ensure you understand the value of the items.
Failing to keep adequate records
If someone claims you didn’t hand over their mother’s engagement ring, you could find yourself in a bad situation quickly. Recording the distribution of each asset, the payment of each debt and the management of every requirement in the last will can protect you as the executor.