Being an Executor of an Estate is not an easy task. You are acting as a fiduciary for the Estate which means you act and make decisions according to a standard. Let’s discuss five mistakes to avoid.
- Mistake number 1: Failure to prepay inheritance tax in Pennsylvania within the first three months. In Pennsylvania, a 5% discount on the net inheritance tax can be taken if paid within 3 months following the date of death. Many fiduciaries are unaware of this benefit and can inadvertently disadvantage the Estate. Talk to your advisor about liquidation options to take advantage of pre paying inheritance tax and how to accomplish this with planning in advance as well.
- Mistake number 2: Failure to safeguard decedent’s property. Failure to change the locks on the decedent’s home in a timely manner can cause vandalism, squatter issues and other potential serious problems. Be sure to forward decedent’s mail to you.
- Mistake number 3: Failure to remove a relative or squatter who wastes decedent’s property. Once there is a squatter or wasteful relative living in decedent’s property, steps must be taken to remove them. Steps need to be taken to sell the property in a timely manner to avoid problems and waste of an asset.
- Mistake number 4: Failure to properly maintain decedent’s home: Repairs, maintenance and utility bills must be paid. Make sure to remove snow and keep up with any issues that will impact the decedent’s property value.
- Mistake number 5: Failure to change the homeowner’s insurance policy. Once the homeowner dies, the homeowner’s policy must be changed.
Some mistakes are simple and can be corrected, while others are more costly. Be sure to get advice if you are unsure about these issues. Executors can potentially be held liable for mistakes.