Estate administration is the legal process of maintaining and distributing someone’s assets (like real property and personal property) after they pass away. The sum total of one’s belongings and property is referred to as their “estate”. The estate administration process is generally executed in accordance with either the testamentary will of the “decedent” (person who died).
If they did not have a valid will when they died, their estate will be administered according to the laws of their state.
What Happens During the Estate Administration Process?
The estate administration process involves several important steps and tasks that need to be completed. The process generally begins with the death of the decedent. Typically, the decedent's estate is opened by the executor.
This is the person appointed by the decedent, usually in their will document. If no person is appointed, then the court may select one on the decedent’s behalf. Alternatively, other interested persons can apply to be the executor by filing an application with the court to administer the estate.
Once the court appoints a formal executor or administrator as the personal representative of the decedent's estate, then the process can fully begin. It is then the responsibility of the personal representative to administer the estate and to account to the court for its proper administration.
The estate administration process typically involves settling any outstanding debts associated with the estate, distributing the remaining property amongst the beneficiaries, and other important actions.
What are the Estate Executor’s Duties?
The executor assumes general responsibility over the decedent’s finances. The duties of an executor may include:
- Dealing with creditors;
- Defending against lawsuits;
- Managing the estate’s assets;
- Identifying the will’s beneficiaries; and
- Ensuring that the beneficiaries receive their proper inheritance.
The executor is also directed to pay debts and taxes to creditors and the government from the estate’s assets. That is often the first step before any assets can be distributed to heirs.
What Expenses are Associated with Estate Administration?
As can be expected, there may be various expenses and costs associated with administering an estate. Administering an estate can take a considerable amount of time and resources. Estate administration expenses can vary from case to case, but they typically involve:
- Commissions for the executor (these may vary be state law);
- Attorney’s fees and costs; and
- Various miscellaneous expenses.
Miscellaneous expenses may include costs associated with the collection of assets, debt payments, and property distributions. Expenses that are deemed necessary for the administration of the estate may usually be deducted from taxable income. Attorney’s fees for estate administration are typically considered necessary expenses.
Can You Fire or Switch Executors?
Usually, the executor is chosen because they are close to the decedent and may have some understanding of the decedent’s wishes with regard to their property. However, it can happen that the executor may be removed or changed on account of disputes, legal violations, or other issues.
In general, a removal of the executor can happen for reasons such as:
- Waste or embezzlement of estate funds;
- Inability to execute the duties of the office properly;
- Wrongful neglect of the estate and estate assets;
- Acting as a threat to the estate.
Just as selecting an executor is an important decision, attempting to remove an executor is also important and can have significant effects on the way the estate is administered overall.
Who Can Remove an Executor?
Only the court can remove an executor. But any interested person can petition the court to remove an executor from their role. An interested person is usually any present or future beneficiary or creditor who has a personal stake in the estate. A common example of this is a person who is named in the decedent’s will and stands to gain some property as an inheritance from the estate.
The petition for removal may be combined with a request for appointing a new executor. This can sometimes cause some delay in the overall administration of the estate until a new executor is finally appointed.
What Do You Need to Remove an Executor?
The objecting party must present the court with all facts showing "cause" (i.e.a proper basis) for the executor's removal. If the court determines that there are sufficient grounds for removal, then the executor can also show why they should not be removed from the position. If the executor fails to attend the hearing or answer the court’s request, they will automatically be removed as the representative.
Do I Need an Attorney for Help with Estate Administration Issues?
The person selected to administer an estate may have tax or legal questions that need to be answered by a wills, trusts, and estates lawyer or a tax professional. An experienced estate administration lawyer in your area will know what to do, and help guide you through the legal formalities.
If any legal disputes or lawsuits arise in connection with the estate, an attorney can provide representation and guidance for those legal proceedings as well.