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The Ins and Outs of Estate Administration

It can be an incredible honor to be named as executor of a loved one's estate. The opportunity to serves as a fiduciary – someone in a position of trust and confidence – is an important one. Learn more about estate administration in this presentation.

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The Ins and Outs of Estate Administration

  1. 1. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 THE INS AND OUTS OF ESTATE ADMINISTRATION
  2. 2. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 WHAT YOU NEED TO KNOW ABOUT ESTATE ADMINISTRATION
  3. 3. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 It can be an incredible honor to be named as executor of a loved one's estate.
  4. 4. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 The opportunity to serves as a fiduciary – someone in a position of trust and confidence – is an important one.
  5. 5. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 But, if you don't have any experience, you may feel a bit overwhelmed. This article will discuss some of the basic duties of an executor and general information regarding the estate administration process.
  6. 6. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 WHAT IS INVOLVED IN ADMINISTERING AN ESTATE?
  7. 7. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 First, the basic purpose of estate administration is to provide court-supervision over the transfer of estate assets in an organized manner
  8. 8. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 The process is based on the probate laws of the state where the deceased individual resided.
  9. 9. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 The two primary goals of the probate process are to pay off the remaining debts and distributing the assets of the estate to the heirs or beneficiaries.
  10. 10. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 HOW TO INITIATE THE ESTATE ADMINISTRATION PROCESS
  11. 11. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 The probate process basically begins in the appropriate court for the county where the deceased was living at the time of his or her death.
  12. 12. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 The first step is filing an application with the court. Once the application has been filed, certain citations and notices must be given depending on the case before a hearing can be scheduled.
  13. 13. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 HOW ARE ASSETS DISTRIBUTED?
  14. 14. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 First in line to receive a distribution from an estate are the creditors.
  15. 15. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 Put another way, before any assets can be distributed to heirs or beneficiaries, all creditors with legitimate claims must first be paid.
  16. 16. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 Once those items have been paid, the remaining assets can be distributed to the appropriate heirs and beneficiaries.
  17. 17. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 DISTRIBUTIONS MADE TO HEIRS AND BENEFICIARIES
  18. 18. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 After debts and other expenses have been paid, distributions required by will or trust are made, including bequests of specific gifts, cash or property.
  19. 19. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 Once those initial distributions have been made, any property that remains can be distributed to the person chosen to receive the remainder of the estate.
  20. 20. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 Based on the types of the assets involved, the property can be distributed directly to the heirs.
  21. 21. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 However, in some cases the property must first be transferred to a trust, if that is required by the terms of the estate plan.
  22. 22. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 THE CONSEQUENCES FOR EXCLUDING CREDITORS
  23. 23. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 This mistake could come with some very serious consequences.
  24. 24. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 Although executors are not usually held legally responsible for debts and estate taxes, when creditors or taxes are not paid and there are insufficient funds remaining to pay these expenses, the executor could be held responsible.
  25. 25. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 MEETING DEADLINES IS EXTREMELY IMPORTANT
  26. 26. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 Missing a court-imposed deadline or the deadline for filing the estate tax return can be a significant mistake.
  27. 27. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 If, for any reason, you are unable to comply with a court deadline, you should always appear in court and explain why you were unable to do so.
  28. 28. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 As for estate taxes, the estate tax return (Form 706) is due within nine (9) months of the decedent’s death. Estate or trust tax returns are due on April 15th, just like personal income tax returns.
  29. 29. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 CONCERNS WITH THE ADMINISTRATION OF A TRUST
  30. 30. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 Administering a trust is similar to administering an probate estate.
  31. 31. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 There can be differences in how you handle the principal of the trust and the income derived from the trust property.
  32. 32. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 One example may be transferring the principal to one person, while someone else receives the income. If you mishandle these types of issues, you may be held responsible for the mistake.
  33. 33. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 GET EXPERT ADVICE IF YOU HAVE QUESTIONS ON HOW TO PROCEED
  34. 34. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 There is really no such thing as "standard" distribution provisions.
  35. 35. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 The terms of every will, trust or other estate planning document are unique and should be reviewed carefully. It would be a mistake for any executor to make assumptions about what needs to be done.
  36. 36. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 If you are confused about any aspects of your duties as executor or if you lack any financial experience, consult with an attorney.
  37. 37. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 CONTACT US!
  38. 38. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 If you have questions regarding estate administration, or any other estate planning needs, please contact The Vermillion Law Firm, LLC either online.
  39. 39. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 LEARN MORE ABOUT THE INS AND OUTS OF ESTATE ADMINISTRATION IN TEXAS
  40. 40. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 (972)386-4560 www.VermillionLawFirm.com The Vermillion Law Firm, LLC

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