Serving as a trustee or executor requires fulfillment of several duties.
Perhaps family members or friends have asked you to serve as the executor, trustee, or agent in their estate plan.
You are not sure what this means.
They tell you the role is essentially following their instructions in their estate planning documents.
Although this is true, it is often not as simple as it sounds.
According to a recent The Sentinel-Record article title “You’re an executor or trustee … Now what?,” serving in this role requires attention to time, organization, and detail.
These roles are not impossible, but it is often helpful to know what is required before you agree or before you must take action.
What are the responsibilities of an executor, trustee, and agent?
The executor is the individual or corporate executor (think trust company) legally appoint to administer the final affairs of a decedent who left a last will and testament.
If the person died intestate (i.e., sans last will), the probate court judge will designate an individual or corporate executor to fill the role, except the title is commonly “administrator” instead of executor.
If the individual had a last will and testament, the executor will be appointed in this document.
An executor will file the original last will and testament with the probate court before being formally recognized in the role.
After this is done, the executor should inform beneficiaries of their status and provide copies of the estate planning documents.
The executors will also notify and pay creditors, distribute assets, and file the final tax returns.
A trustees is designated within the trust document by the “trustmaker” (also known as the grantor, settlor, or trustor).
The trustee can be a person or a corporate trustee.
Although the trustee should inform beneficiaries of the terms of the trust and may need to contact creditors and pay bills, the trustee does not have to work with the probate court to distribute assets.
This individual has authority granted through a power of attorney.
An individual designates this trusted agent to handle her financial and health care decisions if that individual should ever become incapacitated.
Preserving and managing assets for the incapacitated individual is the primary role of the agent.
Typically, there is a separate power of attorney for financial and for health care matters, even though the same agent may fulfill both roles.
The roles of an executor, trustee, or agent are critical to a comprehensive effective estate plan covering both incapacity and death issues.
Reference: The Sentinel-Record (Nov. 24, 2020) “You’re an executor or trustee … Now what?”