Does an Executor Have to Notify Beneficiaries?

If someone dies and puts you in charge of their estate in their will, you are their Executor or Personal Representative. There are three basic things Executors must do: 1) Protect the Estate by identifying and securing the property owned by the estate, 2) Probate the Will, which makes it legally effective. You can then begin to do things like sell assets and obtain tax clearance; and 3) Pay creditors and beneficiaries. Does an Executor Have to Notify Beneficiaries?Executors have certain fiduciary duties governing how they administer the estate. One of the foremost fiduciary duties required of an Executor is to put the estate’s beneficiaries’ interests first. This means you must notify them that they are a beneficiary.

As Executor, you should notify beneficiaries of the estate within three months after the Will has been filed in Probate Court. For beneficiaries of assets that are not included in the will (and therefore do not pass through Probate) there are no specific notification requirements. For all items listed in the Will, however, that becomes a matter of public record once it is admitted to Probate. If you are the Executor, bear in mind if someone does not think they are getting all they are entitled to under the Will then they can go to the Probate Court where the Will is filed and review the document, make copies of it, and get their own attorney involved if necessary. You should consult with a family law attorney if you are unsure how to proceed as personal representative of an estate.

Some assets do not have to go through probate. Assets that do not have to go through the probate process are those that automatically pass to someone else at the testator’s death. Examples include life insurance, retirement and other financial accounts, and property owned “Jointly with Rights of Survivorship.” Assets that typically are considered part of the probate estate are bank accounts in the testator’s name, real estate owned by the testator, vehicles, furnishings, etc. A shorthand rule of thumb is, if it has a designated beneficiary assigned to it, the asset does not usually have to go through probate. If the asset does not have an assigned beneficiary, it usually does have to go through probate.

Beyond your fiduciary duty to put estate beneficiaries’ interests first, you also have an obligation to protect the estate’s assets, follow valid Will instructions, keep good financial records, be impartial and treat all beneficiaries fairly, and keep the estate’s assets separate from your own assets. Some things to avoid as an Executor are delegating your personal decision making responsibilities, putting your interests ahead of the estate’s interests, failing to act prudently with investments, making a profit from the position (executor compensation is not-for-profit), and buying estate assets without express permission.

You will be more likely to attain and keep the trust of beneficiaries. If you do not wait for them to come to you. If you notify them as soon as you can once you identify all beneficiaries, they will see that you are being proactive and are taking your role as Executor seriously and ethically. Always be aware of the potential of real or perceived conflicts of interests. If it looks like you are unfairly gaining from your position as Executor, or shortchanging a beneficiary in a way that could benefit you, it could lead to claims against you and greatly slow down the administration of the estate.

Do You Have to Do Probate When Someone Dies?

One question I often get is: Do you have to go through the Probate Court when a loved one dies? The short answer is no, not always. There are times when going through the Probate process is required. The process of going through Probate is referred to as “opening an estate.”

In Alabama, there is a piece of legislation called the Alabama Small Estates Act. This law created a process called Summary Distribution. Summary distribution provides a means to distribute the assets of a small estate without going through the full Probate process of opening an estate.Do you have to do probate when someone dies?

In order to qualify for Summary Distribution, an estate must not be worth more than $25,000 adjusted annually for the Consumer Price Index. For 2019, that amount was $29,710. Therefore, an estate must be valued at less than or equal to $29,710. Additionally, the deceased person must not own any “real property.” Real property is considered to be land and buildings on land. If the estate is worth more than $29,710 in 2019 or the deceased person owned any land, you must go through the Probate process and open an estate.

Another instance in which you don’t have to go through Probate is when the deceased person has jointly owned property. Jointly owned property would include bank accounts with a significant other or child as co-owner of the account. Another jointly owned item could be a piece of real property that is held jointly with the right of survivorship. Joint tenancy with the right of survivorship means the deceased co-owned the property with another person and upon the deceased’s death, the property is solely owned by the surviving owner.

Finally, one of the ways you can avoid Probate is to create a Living Trust. A living trust is created during the deceased’s life. You will need to have a local family law attorney create a Living Will for you, since it can be quite technical and difficult to prepare. During their lifetime, the deceased transfers his or her property into a Living Trust. It is important to note that retirement accounts and life insurance accounts (which specify a beneficiary other than the estate) are also not required to pass through the Probate process.