What Do I Do Now?
A good friend or relative, let’s call him “ Joe,” has just died and you’ve been named executor of his estate. What if there is no Will, there is no family, and you are just Joe’s best friend? What do you do next? In many instances, the next thing you should do is call an attorney.
If you are lucky enough to have prior knowledge of your being named executor, you will have discussed Joe’s funeral wishes with him. It will be your job to see that those wishes are carried out, keeping in mind that the family should have input into the details if they desire.
After that, the next thing is to locate the original Will and obtain a death certificate, which the funeral home should be able to quickly provide as part of their service. Then a telephone call to make an appointment for probate at the Circuit Court in the jurisdiction where Joe lived is in order so that you may qualify as Executor or Administrator. You will need a preliminary determination of values in order to prepare the probate documents. When you arrive for that appointment, you should have with you the following: The Will, death certificate, a prepared Memorandum of Facts - Probate, Probate Information Form, Probate Tax Return, and a List of Heirs. A Notice to Persons of Interest and an Affidavit of Notice filed with the court will be prepared at probate.
Obtaining a tax ID number for Joe’s estate is the next step. This is done by filing an EIN request with the Internal Revenue Service. Like many things, this can be done online. With your qualification documents from the court and your proof of an EIN number, you can then open an estate bank account, consolidate the assets, and pay Joe’s bills. There is a priority to the debts that you will pay, especially if there are not enough assets to pay all the debts.
The Commissioner of Accounts requires that an Inventory of Assets at date of death be filed with the Commissioner’s office within four months of probate. This means you will list the value of Joe’s personal property, Virginia real estate, any jointly owned property, and any non-Virginia real estate. The previous year’s tax return can provide much of the needed information. You should also be compiling the information necessary to file the first Accounting. This includes the list of assets, proof of the payments you have made, and the balance on hand. Copies of all checks are essential.
In approximately six months, you will file a Debts and Demands Notice to Creditors. You should also have paid specific bequests by then, if possible. The First Accounting is normally filed after specific bequests are paid and debts and demands requested. A Federal Estate tax return, if one is necessary, is due nine months after death. After all those tasks are done, a Show Cause Against Distribution is filed, a Distribution Order is prepared and a Final Accounting of everything you have done for Joe is filed, and must be approved by the Commissioner of Accounts before the estate is considered closed.
Administering an estate is a privilege, but it is also a lot of work. If you are not a detail-oriented person, preparing the necessary paperwork can be a nightmare. Hiring an attorney to advise you, or to do the majority of the work, is frequently a prudent decision.
A. James Kauffman has many years of experience in the area of Estate Administration and can be contacted at Taylor and Walker’s Richmond Office.
