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persfi/sfvbj/17″/mike1st/mark2nd MEL POTESHMAN Would you accept a new job for which you have no prior experience? That’s exactly what many people find themselves doing as the executor of a friend’s or family member’s estate. The executor of an estate the person responsible for carrying out the terms of a will has numerous financial, legal and tax responsibilities and must possess good organizational and interpersonal skills as well as some financial know-how. The best way to prepare for such a job is by finding out in advance what is expected of you. One of the executor’s primary jobs is “probating the will.” This process entails filing the will at a local surrogate court so that it becomes part of the public records. There’s no deadline for probating the will, but it cannot be done earlier than 10 days after the estator’s death. The next step is the “marshalling” of assets. This task involves an accounting or inventory of the assets of the deceased and can require quite a bit of sleuthing. In addition to looking at prior income tax returns and other sources for assets, the executor may end up searching through closets, dresser drawers and shoe boxes to locate bank books, savings bonds, and even stock certificates, unless the deceased had previously indicated where such documents are located. The duties of the executor during this phase of the probate process can range from listing one or two bank accounts to compiling portfolios and contacting brokers and agencies all over the country in order to locate assets. It also involves the collection of outstanding income or money owed, including amounts owed from employers, Social Security and insurance companies. If the search for assets is too difficult or time consuming, help is available. Financial services companies, brokerages, and some financial planning agencies can, for a fee, locate the decedent’s assets. Costs incurred for these and other expenses associated with probating the will or marshalling assets are typically reimbursed by the estate. Once the assets are located, the executor may need to liquidate some of them to pay off the deceased’s debts and to make distributions to heirs. Liquidating the property can involve selling stocks, bonds, or real estate, as well as exercising options on securities. When it comes to collectibles like jewelry, artwork and real estate, appraisals need to be obtained to be sure the property is valued accurately. One of the most tedious of the executor’s responsibilities is identifying and paying off creditors. It involves notifying potential creditors who may have a bona fide claim against the estate of the deceased. While some creditors may barrage executors with bills, others may be difficult to locate. If the executor is unsure of all the people to be contacted, the executor can satisfy the obligation to notify creditors by publishing a notice in a local newspaper regarding the claims against the estate. To pay off creditors and liquidate assets in accordance with the terms of the will, you’ll need a checking account for the estate. All money should be funneled through the account so that bills and beneficiaries can be paid. The executor will need to file a final income tax return for the deceased. What’s more, if the estate is valued at more than $600,000, the executor must also file a federal estate tax return, generally within nine months of death and pay any estate taxes that are due. Finally, the executor is responsible for distributing property to the beneficiaries named in the will. All disbursements to beneficiaries, as well as those to the Probate Court, must be carefully documented. As an executor, you can be called on to submit reports and accounting of your actions to the Probate Court. Executors of complex or large estates may want to obtain assistance from CPAs or attorneys when handling the tax, financial and legal matters associated with managing the estate. Mel Poteshman is a certified public accountant and president of Poteshman Consulting International & Co., a West Los Angeles-based business consulting firm.

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