If you've been named as the Executor of a Will, there are several duties that you are required to look after upon the passing of the Testator. Some are time sensitive, so it is essential to have an idea of what your responsibilities will be before you are required to act in that capacity.
Here is a general outline of the primary duties of an Executor:
Probating the Will (if necessary)
Making Funeral Arrangements
Collecting and preserving Estate assets
Paying debts and taxes
Dispersing Estate property to beneficiaries.
It is vitally important that you document everything that you do. This will be helpful to you if there are questions about how the will was executed, and will help to determine how much you will be compensated for your duties. In addition, you might consider buying Executors insurance. With the approval of the beneficiaries, this can be done at the Estate's expense as it ultimately protects both the Estate and the heirs.
It is also important to remember that you can renounce your duties as Executor if you are unable to attend to the Estate completely and in a timely manner.
In order to Probate a Will, you need to have the original Last Will of the deceased. To have a Will Probated you apply for a Grant of Probate to the Court. You will need to fill out the required forms which are available for purchase through the Alberta Queen’s Printer. You may want to have a lawyer do the Probate. You don't have to use the same lawyer to Probate as the lawyer who drew up the Will.
Once you receive The Grant of Probate, issued by the court, you have the authority to carry out the duties as an Executor. Keep in mind that it can take up to a year to Probate a Will.
If you have any questions regarding filling out the Grant of Probate application, please contact the Summit Legal Group office at 587-356-0356.
The testator’s will may provide some instructions for the funeral service. You are not legally obligated to follow those instructions, but it is most common to do so. If the deceased instructed that their body be donated for medical research, you must honour that request and notify family members.
A funeral must not use all or the majority of the value of the Estate, or you could be held personally liable for excessive funeral costs.
Collecting & Preserving Estate Assets
As an Executor, you are required to make a detailed list of all of the assets and debts belonging to the Estate at the time of death. This will include things such as employment benefits and unpaid wages. The assets must be secured and maintained. Some property will not be considered part of the Estate as it will go directly to a named beneficiary such as jointly held property, or RRSP and life insurance with a designated beneficiary.
Paying Debts and Taxes.
In addition to collection assets, the Executor will be responsible for paying any remaining debts out of the Estate, including income tax. You will need to notify creditors of the Estate, which is commonly done by placing an advertisement in a local newspaper.
A final income tax must be filed with Revenue Canada for all income earned in the year of death. Once the tax return has been filed and taxes paid, Revenue Canada will provide a ‘clearance certificate' as proof paid taxes. If you distribute assets before all debts and taxes are paid, you could be held financially responsible for those debts.
Dispersing Estate Assets
After the payment of all outstanding debts and taxes, the remaining assets may be distributed to the beneficiaries. Property is usually given to the beneficiaries within a year from the date of Grant of Probate unless portions of the Estate are being held in trust for a period of time. A trust is a complex obligation in which you hold and protect the gift by investing the funds. If you are a trustee, it is recommended you speak to a lawyer to ensure you are acting within your powers and within the law.
You are entitled to reasonable compensation for the administration of the Estate. In Alberta compensation is usually between 3 – 5%. It is vitally important to keep a record of the time you spend looking after the Estate. You may wish to speak with the beneficiaries soon after the testator’s death to discuss an appropriate amount of compensation to avoid a dispute with them later. If you and the beneficiaries cannot agree, you may apply to the Court to fix the amount of your compensation.
This article is a brief overview of the duties of an Executor. The legal team at Summit Legal Group are available to assist you through every phase of the Probate and Estate Administration process. Please contact our office for a copy of our ‘Executor Guide and Questionnaire’, Or to receive a complimentary, no obligation quote. Tel: 587-356-0356 or Email: firstname.lastname@example.org