You need a good executor for your will. Here’s are some reasons why:
- One of an executor’s roles is to file an estate tax return, pay any estate tax due and eventually distribute the estate’s assets. What happens if the return is later audited and more estate tax is due? The executor takes the heat. He or she is legally responsible and the other heirs may not be willing to give some of their money back to pay the tax.
- When you name an institution you shift that liability away from a family member. Thus, naming an independent executor can take some pressure from your heirs. On the other hand, a corporate entity such as a bank trust department might not make a good executor; there’s no guarantee you’ll have continuity of personnel and the people there may not be available when you need them.
So whom to name? Some ideas:
- Your children: Often, grown children make the best executors, assuming they’re competent and no family friction is likely. However, that may not be practical if your children live too far away or if they have too many business and family commitments.
- Professional advisors. If naming a son or daughter isn’t practical, you might name an accountant or an attorney to serve. Your estate will have to pay professionals for their services, so a fee schedule should be worked out in advance.
Whomever you choose as executor, make sure you get his or her consent to serve before naming someone in your will. You should make some provision for a backup executor, too, in case your original selection becomes unable to serve.
For more information on how to choose your executor, see our “Estate Planning Collection” info at the bottom of this issue.