What is the Role of an Executor When Estate Planning?

When you begin the estate planning process, one of the most important things you will need to do is select an executor of the estate. Also referred to as a personal representative, this individual will play a key role in the administration of your estate, and you must choose carefully. A good executor will be someone who is financially responsible, trustworthy, and easy to communicate with. When deciding who you would like to be in charge of administering your estate, it’s essential to keep in mind the executor duties imposed in Minnesota — and choose someone you feel confident will be able to adhere to them and carry out your wishes.

What is the Role of an Executor of the Estate?

An executor/personal representative is the individual who is named in a last will and testament to manage your estate after your passing. An executor of the estate has a wide array of responsibilities and duties, including satisfying any outstanding debts and distributing assets among your chosen beneficiaries. Ultimately, they will be the person who ensures the wishes in your will are carried out.

How is the Executor Appointed?

Even if the executor of your estate is named in your estate planning documents, there is still a legal process that must be followed. First, the executor must find the will and open up a probate case in court. Once the will has been validated, the executor will obtain letters testamentary from the court. This document provides them with the legal authority to act on behalf of the estate.

In some cases, an executor who has been appointed in a will may be unable or unwilling to serve. If this happens — or no executor is named — the court can appoint someone who will serve in the role of personal representative.

What are the Duties of an Executor?

Being an executor of the estate comes with many legal responsibilities and duties. Importantly, Minnesota law imposes many regulations that govern the role an executor/personal representative will have in administering the assets in a decedent’s estate. There are also specific laws concerning the obligations the executor has toward the estate and its beneficiaries.

Executor duties in Minnesota include the following:

• Initiating the probate process — The first task an executor of the estate must carry out is initiating the probate process. This involves filing the last will and testament and any other necessary paperwork with the probate court.
• Taking inventory of the assets in the estate — After the probate process has been initiated, the next step is to take an inventory of the assets and property in the estate. Such assets can include real estate, personal property, bank accounts, stocks, vehicles, artwork, and other forms of property.
• Paying off outstanding debts — An executor of the estate in Minnesota must first settle any debts owed by the decedent before they can distribute the assets in the estate.
• Filing and paying taxes — In addition to paying off the decedent’s debts, the executor must also file tax returns and pay any tax debts.
• Distributing assets to beneficiaries — After all creditors have been paid and tax debts are satisfied, the executor can distribute the assets in the estate to the beneficiaries according to the instructions in the will.
• Closing the estate — Once the assets in the estate have been distributed, the executor will be required to prepare a final accounting that documents how the assets were managed and distributed. Upon court approval, the estate can be closed.

While it can be time consuming to be an executor, Minnesota law allows them to be reasonably compensated for the services they provide. They are either compensated based on the terms of the will, or if the will is silent on this issue, their compensation would be determined by the court.

What are the Responsibilities of the Executor of the Estate?

In addition to the executor duties that are owed to the estate, an executor/personal representative must take care to avoid crucial mistakes that could potentially delay the probate process or result in legal action. For instance, an executor must keep detailed records of all decisions made in their capacity as executor and ensure transparency in all financial transactions. It is critical to avoid mixing separate finances with those of estate. A bank account that is strictly for estate purposes should be opened to ensure finances are not commingled.

An executor also has a fiduciary duty to the beneficiaries of the estate. The executor must notify them that they are beneficiaries, and also provide information to them throughout the probate process. Specifically, the executor must manage the assets in the estate in accordance with the beneficiaries’ best interests and communicate consistently. Failure to do so can result in the beneficiaries taking legal action.

Contact an Experienced Estate Planning Attorney

Choosing the individual who will be your executor/personal representative isn’t easy — and it’s vital to have a skillful estate planning attorney by your side who can guide you through the process. At Mundahl Law, we help ensure our clients create estate plans that will meet their objectives so they can have peace of mind. Located in Maple Grove, Mundahl Law works with clients throughout Minnesota for estate planning matters. To learn more about how we can assist you, or to schedule an appointment, contact Mundahl Law at 763-575-7930 or click schedule a consultation to speak with our Client Advocate.