Administration of an Estate or Trust through the probate process can be a challenge. The administrator has been legally authorized to pay off debts, close accounts, and distribute property to heirs after someone has died. The exact responsibilities of the Estate Administrator are usually specified within a deceased person’s Estate Plan otherwise governed by state law.
WHAT IS AN ESTATE ADMINISTRATOR?
The Administrator of an Estate is the person in charge of managing the Estate through the probate process. In a successful Estate Plan, a last will and testament names the estate planner. Usually, this is the responsibility of the surviving spouse or the closest relative.
An Administrator of Estate is often compensated for their duties because managing an estate through the probate process is a time-consuming process. Often the deceased leaves money or other assets to the Administrator within their will.
If someone dies without a Will or Estate Plan the Administrator will be appointed by the local court and will manage the estate through probate process according to the laws of the state. The appointed Estate Administrator is usually compensated with a percentage of the Estate. This decision is left up to the local court and subject to the laws of the state.
WHAT DOES AN ESTATE ADMINISTRATOR DO?
The role of the Estate Administrator may be very different depending on the size of the state and the instructions outlined in an Estate Plan.
AN ESTATE ADMINISTRATOR CAN EXPECT TO PERFORM THE FOLLOWING DUTIES:
- Gather the belongings, assets, and financial records of the deceased
- Create a financial summary which includes outstanding debts or bills
- Submit a complete inventory of assets and debts to the local court
- Issue notices to Debtors and Creditors
- Request life insurance policies on behalf of the Estate
- Settle any debts owed by the deceased
- Collect monies owed to the deceased
- File state and federal tax returns for the Estate
- Communicate with heirs and beneficiaries
- Distribute assets and property
The Administrator of the Estate should not be confused with Executor. Although both roles have similar roles and responsibilities, there are some differences. An Executor is a person named in the Last Will and Testament who has been chosen to act according to the wishes of the deceased. Instructions for the Executor are found with a successful Estate Plan.
If someone dies without a will the Administrator of Estate is appointed by the court and acts according to the laws of the state.
Both the Executor and the Administrator of Estate report to the probate court. Executors normally have more power when handling the assets of an Estate because they have been designated by the deceased and named in a Last Will and Testament.
If you want to direct how your money and estate are distributed after your death it is important that your wishes are noted in your Last Will and Testament. If you fail to designate an Executor in your will decisions about your money and estate will be left up to the local court. This means important decisions about your assets will made by a court appointed Administrator of Estate and be distributed according to laws of the state.
A successful Estate Plan includes an up-to-date Last Will and Testament which designates the person you have selected to ensure your assets are distributed according to your wishes. Your Estate plan ensures that your assets are not left in the hands of a court appointed Estate Administrator who acts on behalf of the State following the guidelines of the State without consideration for your wishes.
