8 Important Terms to Know When Becoming Executor of an Estate

Becoming the executor of an estate is not an easy proposition, especially when you are unfamiliar with some of the legal terms associated with the tasks you will be required to perform. Some of these terms—assets, debts, heirs, inheritance, and jurisdiction—may be somewhat common knowledge to most. But there are some terms that if you do not fully understand, may lead to delays, contestation, or personal financial hardships.

Let’s break down the top eight important terms to know when becoming executor of an estate.

Executor

The executor of a will is the person (or entity) that is appointed, either by the testator (the person who drafted the will) or by the court in the absence of a named executor, as manager of all legal duties in the collection of assets, resolving debt, and distribution of assets to beneficiaries in accordance with the testator’s wishes. The executor must be honest, diligent, and perform their duties in good faith. They may also be compensated for their services.

Beneficiary

Any individual, charity, or organization, legally designated by the testator to receive assets based on the wishes written in a will is also known as a beneficiary.

Fiduciary Duty

An executor is subject to fiduciary duty, which is the legal and ethical obligation an executor must adhere to when performing their duties, acting in the best interest of the estate and its beneficiaries. Though governing law may vary across jurisdictions, the core values of a fiduciary—loyalty, diligence, care, and transparency—remain universal.

Letters Testamentary

Letters Testamentary are legal documents that officially authorize the fiduciary role of the executor, giving them the legal authority to distribute the decedent’s assets. This includes the power to manage assets, pay debts and taxes, and access bank accounts.

Abatement

The legal process of eliminating (or reducing) a beneficiary’s inheritance when debts, expenses, and taxes exceed the value of the estate is known as abatement. Governed by state law, abatement ensures that all debts and costs are paid before any assets are distributed.

Codicil

A codicil allows a testator to amend their existing will without rewriting the entire document. In other words, this legal document is used as an addendum to update beneficiaries or executors, revise asset distributions, or void the original will.

Ex parte

Meaning “for one party,” ex parte is a legal request by one party to seek emergency relief without notifying any other party. Generally, courts will require proof of irreparable harm to justify a ruling on an ex parte petition.

Intestate

When there is no will or other legally binding document left behind by the decedent, the probate process becomes intestate. This alters the way assets are distributed through probate, as the probate court now becomes responsible for all decisions regarding the estate, subject to the state’s laws of intestacy.

If you still have questions, it’s best to check out our Executive Duties Checklist, and then reach out to a qualified probate attorney.

Tags: abatement, beneficiary, codicil, ex parte, Fiduciary, fiduciary duty, intestate, intestate probate, Letters Testamentary, Probate Fiduciary
Posted in Estate Planning - Wills, Trusts, and Probate, Executor | No Comments »