If you have recently been named the executor of a loved one’s estate, you have serious legal responsibilities to wrap up this person’s affairs, distribute the assets of the estate and pay for any income and estate taxes in accordance with relevant laws. Far too often, executors who mean well, and even those who don’t can make mistakes that could expose the entire estate to litigation or even higher taxes.
Some of the most common mistakes can be avoided by ensuring that you have completed proper estate planning and your executor is well aware of the role they will play. Executors can make mistakes, such as:
- Not paying taxes on tangible personal property.
- Confusing non-probate and probate property.
- Failing to hire counsel at a negotiated or reasonable fee.
- Not liquidating securities.
- Not following the terms of the will.
- Inappropriately allocating income between the estate income tax and the decedent’s income tax returns.
- Making distributions to heirs too early that can expose the executor to personal liability.
- Failing to choose an appropriate fiscal year for the estate.
- Not appraising personal property.
In all of these circumstances it is beneficial to plan in advance to minimize the possibility of an executor making costly mistakes that could delay the probate process and the distribution of assets to loved ones.
Our NH estate planning lawyer can guide you through the process of what to do if you have questions about serving as an executor. Schedule a consultation today to get your questions answered.