“Administration of Estate” refers to the actions necessary to guide an Estate through the probate process. This involves paying off any debts, closing accounts, and distributing property to heirs after someone has died. The exact responsibilities will be specified within the deceased individual’s Estate Plan or by state law.
The Administration of Estate process can be difficult to understand, as it touches on several important aspects of Estate Planning. The following guide aims to answer any questions you may have about the topic:
What is an Administrator of an Estate
The Administrator of an Estate is the person in charge of compiling assets and managing the Estate through probate court. An Administrator, or personal representative, is typically named within the Estate Plan. If the deceased did not have a Will or Estate Plan, the Administrator will be nominated by the court. This responsibility will typically fall on a surviving spouse or the closest living relative (also called the next of kin).
In most cases, the Administrator of Estate will be compensated for their duties -- as managing an Estate through probate can be a time-consuming process. Often, the deceased will opt to leave money or other assets to the Administrator within their Will. If there is no Will, the state will decide how to compensate the Administrator (usually with a percentage of the Estate).
What does an Administrator of an Estate Do? Common Administrator of Estate Duties
The exact role of the Administrator of an Estate will vary depending on the size of the Estate, and whether or not there was an Estate Plan. That being said, here is an outline of typical Administrator of Estate responsibilities:
Gather the belongings, assets, financial accounts of the deceased
Take note of any outstanding debts or bills
File an inventory of all assets and debts with the Court
Issue a Notice to Debtors and Creditors
Request life insurance policies payable to the Estate
Settle any debts and collect any money owed to the deceased
File state and federal tax returns for the Estate, as well as any gift tax returns that are needed
Communicate with the heirs and beneficiaries about the Estate
Distribute assets and property according to the Estate Plan or state law
What’s the Difference Between Executor and Administrator of Estate?
The difference in an Executor and Administrator of Estate is how the two roles are established. An Executor is named within a Last Will and Testament, while the Administrator of Estate is typically appointed if someone dies without a Will. Both the Executor and Administrator of Estate must report to probate court, though Executors generally have more power when handling assets. The reason for this is because the Executor is typically granted additional responsibilities within a Will, while an Administrator of Estate is guided by state law. Overall, the roles and responsibilities of each position are quite similar. Read our guide on the responsibilities of an Executor to learn more.
Other Frequently Asked Questions About Administration of Estate
The Administrator of Estate is a unique responsibility -- read through the following commonly asked questions for more information about this role:
How to File for Administrator of Estate
If you are wondering how to be appointed as the Administrator of Estate, the first step is to cite your state’s Intestate Succession Laws. This will help you determine who will serve, though the responsibility generally falls on the surviving spouse. Once you have determined who has priority to serve, file a petition with the county court to initiate probate.
Before filing, you should gather information about the deceased, including their birthdate, full name, address, and a list of their living relatives. You will also need a preliminary list of the deceased person’s assets and accounts. Contact your county clerk to learn exactly which information to include -- then submit these documents along with the death certificate. At this point you can sign the petition, submit your filing fee, and schedule a hearing with probate court (when necessary).
Can an Administrator of an Estate Sell Property?
Another common question about Estate Planning is whether an Administrator of Estate can sell the deceased person’s property. The answer depends on state law, but generally speaking the Administrator can sell property in order to pay outstanding debts on behalf of the Estate. The Administrator will need to obtain court approval before listing or selling the property -- and it is generally recommended to work with a probate attorney throughout the process.
Are There Administrator of Estate Fees?
There are Administrator of Estate Fees, as this is a complex and time-consuming responsibility to take on. If there is no Will or Estate Plan, state law will determine how much the Administrator is paid. The fee structure is usually either a percentage of the gross value of the Estate or a percentage of transactions handled. Additional compensation can be expected if the Administrator goes outside of the typical duties, for example if they handle litigation on behalf of the Estate or manage the sale of a property.
Do I Need a Lawyer to Administer an Estate?
You do not need a lawyer to Administer an Estate, though traditionally it is recommended that you work with one. The reason for this is because most individuals do not have Estate Planning experience, and the probate process can be complex. A lawyer will be able to provide guidance as you navigate court proceedings.
If you want to avoid placing this responsibility on a loved one, the best way to move forward is to create an Estate Plan for yourself (and encourage relatives to do the same). At Trust & Will, we aim to make this process as simple as possible -- eliminating the need for further legal help or guidance. By writing a comprehensive Estate Plan with the help of our team, you can help prevent any future difficulties.
The Administration of Estate process is a challenging, but necessary requirement after someone dies. If there is no Will or Estate Plan, the role of Administering the Estate will fall on a court-appointed loved one, thus presenting them with a huge responsibility. By learning about the duties of an Administrator you can better prepare yourself should you be selected; and you can begin making your own Estate Plan to help your loved ones to better navigate the process.