Understanding Your Appointment
Suppose your mom, who is widowed, has 3 children (including you). She executes a will that leaves her estate to you and your 2 siblings, and names you as executor of her estate. Then your mom dies. You hire an attorney who files all of the necessary documents with the probate court, and after a short hearing, the court appoints you as an independent executor for your mom’s estate.
Congratulations – you just became a statutory agent of the court. That honor carries with it all rights, powers, and duties that are established by statute or common law. Violate them at your peril.
Your Core Fiduciary Duties
Acting Reasonably, Prudently, and Honestly
You have the duty to take reasonable care of all estate property as a prudent man would do, except for extraordinary casualties. Then, you are required to protect the interests of the estate beneficiaries, which includes your 2 siblings. You have a duty to do fair dealings in good faith with fidelity and integrity.
This includes:
- Acting in good faith at all times
- Protecting all beneficiaries equally
- Exercising reasonable and prudent judgment
- Maintaining integrity and fairness
Collecting and Protecting Estate Assets
You have a duty to collect all assets, claims, debts due, personal property, records, books, title papers, and business papers of the estate. You will hold these for delivery to those entitled to receive them when the estate is closed.
Assets you must gather may include:
- Real and personal property
- Claims, debts owed, and income
- Business documents, title papers, and records
- Financial accounts and personal items
Avoiding Conflicts of Interest
Your personal interest cannot conflict with your fiduciary obligations to the estate. That means that, while you are entitled to 1/3 of the estate, you cannot cherry-pick the estate assets to give yourself the best items and leave junk for your siblings.
Personal Transactions With Beneficiaries
If you engage in personal transactions with a beneficiary regarding the estate, then those transactions give rise to a presumption of unfairness. The Court will presume that you acted unfairly; it will be up to you to convince it otherwise.
For each personal transaction, you must be prepared to show:
- Full disclosure of all facts
- That any consideration was adequate
- That the beneficiary had the benefit of independent advice
Managing Estate Property and Finances
Handling Expenses and Maintenance
You have the power to incur expenses and expend funds for the maintenance and upkeep of all assets. You will need to obtain insurance on the assets of the estate until they are distributed to the beneficiaries.
Opening and Using an Estate Account
Typically, you will open an estate account to hold monies that you collect for the estate and to pay estate expenses.
Managing Real Property
If the assets of the estate include real property, then you should obtain an exact legal description of the property as soon as possible. If property taxes are due on the real property, then you should pay those.
Handling Royalty Interests
If the estate assets include producing royalty interests, then you will need to get new division orders so you can begin receiving all payments. These do not transfer title; that will be done when you distribute the interests to the beneficiaries.
Re-registering Investments
You should re-register all stocks and bonds in your name as the independent executor.
Addressing Debts and Tax Obligations
You should make a list of all of your mom’s known debts. There is a probate claim procedure that should be followed by creditors, but in some cases, it may make sense just to pay a particular debt.
Tax Responsibilities
Then there are taxes. For most estates, it makes sense to hire a CPA to prepare your mom’s final tax return and any estate returns that may become due.
A CPA can assist with:
- The final individual tax return
- Estate tax filings
- Compliance with IRS deadlines
- Avoiding penalties for filing mistakes
Keeping Records and Working with Beneficiaries
Remember to document everything, keep good records, and go above and beyond to treat your siblings fairly. You owe them a fiduciary duty.
Best practices include:
- Keeping thorough documentation
- Retaining receipts, invoices, and correspondence
- Communicating regularly with beneficiaries
- Maintaining transparency throughout the process
Final Guidance
This just scrapes the surface of your duties. Your attorney should be available to answer any questions and give you additional guidance.
Good luck.
Conclusion: Know Your Executor Duties Before You Begin
Serving as an executor is a significant legal responsibility that requires fairness, transparency, and careful decision-making. Even in the most cooperative families, problems can arise if estate administration isn’t handled properly.
At Hammerle Morris Law Firm, we help executors understand their obligations, manage estate assets correctly, and avoid disputes. Whether you’re preparing to serve or already navigating probate, our attorneys can provide the guidance you need.
Schedule a consultation to ensure your actions comply with the law and align with your fiduciary duties.
Virginia Hammerle is an accredited estate planner and represents clients in estate planning, probate, guardianship, and contested litigation. She may be reached at legaltalktexas@hammerle.com. This blog contains general information only and does not constitute legal advice.
