If someone has asked you to serve as the executor of their estate, you likely have a general understanding of the role. However, the specific tasks involved in settling an estate can be more complex than they appear.
Understanding the steps required to administer an estate can help you feel more prepared for this important responsibility. Let’s walk through the basic steps you have to take to settle an estate as an executor.
Identify the Will
The first step is to locate the will itself. Ideally, the person who appointed you as executor will have already informed you where to find it.
If this conversation didn’t happen, you’ll need to search through the decedent’s important documents. This may involve checking files, safes, or other secure locations.
If the decedent had an attorney, contacting their office may help you track down the document. In some cases, attorneys may keep a copy of the will or can guide you to its location.
Open the Estate and Notify Creditors
Once you’ve located the will, you can’t take action on your own. You must file the will with the probate court to officially open the estate. In some cases, the court may hold a brief hearing to formally recognize you as the estate’s executor. Afterward, you’ll have the legal authority to act on behalf of the estate.
A critical part of probate is paying the decedent’s final debts. To do this, you’ll need to notify creditors that the estate is being settled. This is typically done by placing a notice in a local newspaper, giving creditors the opportunity to submit claims.
Open an Estate Bank Account
As the executor, you will handle the estate’s finances, including paying outstanding debts and taxes. To do this efficiently, you’ll need to open a separate estate bank account. This ensures that all transactions related to the estate are kept separate from personal accounts.
To open the account, you will need an Employer Identification Number (EIN) from the IRS, which you can obtain easily online. This EIN functions like a Social Security number for the estate, allowing you to file taxes and manage financial matters.
Gather Documents and Inventory Assets
With the estate open, the next step involves gathering relevant documents and identifying the decedent’s assets. This includes locating titles to property, recent tax returns, and financial statements.
In some cases, the decedent may have left behind a letter of last instructions. This document, while not legally binding, provides helpful information for the executor. It may include contact details for important individuals, the location of critical documents, and instructions for accessing online accounts.
Once you have gathered all necessary documentation, you must inventory the estate’s assets. This includes both physical and financial assets, and you’ll need to notify financial institutions of the decedent’s death so that the accounts can be frozen.
Determine the Value of the Assets
Once the assets are identified and secured, the next step is to place a value on them. Some assets, like bank accounts or stocks, have clear monetary values. However, for other assets – such as real estate or valuable personal property – you may need to hire a professional appraiser.
If the total value of the estate exceeds certain thresholds, estate taxes could be a concern. However, most estates are not subject to federal estate taxes, as the exemption is currently $13.61 million. Nevertheless, it’s important to account for the estate’s value accurately.
Pay Taxes and Final Debts
As the executor, you are responsible for paying the decedent’s final taxes, including any income taxes owed. Additionally, you must satisfy all legitimate creditor claims. This step can involve reviewing claims, determining their validity, and using estate funds to settle debts.
You will also need to cover the costs associated with administering the estate. This may include legal fees, appraisal costs, and accounting expenses. These expenses should be paid from the estate’s assets before distributing the remaining assets to beneficiaries.
Distribute the Assets to Heirs
After all debts, taxes, and administrative costs have been settled, the final step is to distribute the remaining assets to the beneficiaries. This is typically done according to the terms laid out in the will.
Once the court is satisfied that all obligations have been met, it will close the estate, and you can distribute the assets to provide closure for the family.
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While this blog outlines the general steps involved in settling an estate when a will is used to transfer assets. However, every estate is unique, and there are other possibilities.
For example, a living trust can offer a more streamlined solution for some, bypassing probate entirely and offering added privacy.
When you work with our firm, we will explain your options so you can make fully informed decisions. To get started, call us at or send us a message through our contact form and we will get back in touch with you promptly.