Beneficiaries and Executors: Important Rights and Responsibilities
The process of estate planning allows us to make essential decisions about how our property is passed to beneficiaries. Beneficiaries have certain rights and responsibilities by law, as do those who have been given fiduciary responsibilities. Whether you are drafting a will, or you have been named as a beneficiary or executor in someone else’s will, it is important to understand exactly what these roles entail. In most cases, the creator, beneficiaries, and fiduciaries of an estate plan can benefit from consulting with a skilled estate planning attorney.
Choosing Your Beneficiaries Is No Small Task
You have worked hard to earn the property contained in your estate. Choosing who should inherit your estate and how are significant decisions that you might be struggling with. When choosing your beneficiaries, there are many variables to consider, including the size and dynamics of your family and the type of legacy you intend to leave. For example, if you have a relatively small number of descendants and you are fairly close with all of them, you might decide to name each of them as beneficiaries–with each receiving a sizable portion of your estate. If your family is larger and you do not have particularly close relationships, you could opt to leave some of your estate to your family while making substantial charitable contributions with the bulk of your assets.
Beneficiary Rights and Responsibilities
A person who has been named as a beneficiary in a will, trust, or any other instrument of transfer has certain rights. These rights include the right to be notified of his or her status as a named beneficiary as well as the value of the property that is intended for him or her. A beneficiary also has some responsibilities, as well, including the responsibility for handling any taxes or liabilities that might accompany inherited assets. Such responsibilities are especially important for beneficiaries who inherit real property or business interests.
Determining the Right Executor for Your Will
A “fiduciary” is a person or entity who is appointed to act on behalf of another individual or group. Fiduciary responsibility means the appointed person or entity is expected to put the individual’s or group’s interests ahead of their own.
In a last will and testament, the most common type of named fiduciary is the executor. Generally, the executor is the person who is responsible for carrying out the provisions of the will. The executor acts as a personal representative of the deceased person. This role takes a great deal of responsibility and commitment, and it can be challenging both legally and emotionally. The executor must:
- File the will with the probate court
- Get the death certificate
- Notify friends and family of the death
- Notify the Social Security Administration, post office, bank, insurance companies, and Medicare of the person’s passing
- Manage the deceased person’s assets
- Pay the deceased person’s outstanding debts
- Distribute assets to heirs
An executor has also certain rights, including the right to make decisions as he or she sees fit regarding the estate, provided that the decisions are in the overall best interest of the estate. The executor also has the right to be reimbursed for any expenses incurred on behalf of the estate. In most cases, the executor can be paid for his or her services and time as well.
When choosing an executor, it is important to choose someone who is up to the task. The ideal executor should be responsible and organized. The right executor should also be able to put grief and emotions on hold in order to fulfill the responsibilities asked of him or her. You should also choose an executor who understands you, your values, and your priorities so that he or she can manage your estate in a manner that is consistent with your wishes.
Call Us to Learn More
When creating a will, selecting an executor and your beneficiaries are likely to be among your most challenging considerations. Similarly, if you have been named as a beneficiary or fiduciary, you are likely to have a number of questions and concerns. In either situation, a qualified attorney can provide the help you need. If you are looking for guidance, call 630-756-1160 to speak with a Naperville estate planning lawyer from the Gierach Law Firm.