Should I serve as administrator of the estate?
Well if you’re asking yourself that question that means you give a loved one who died and there’s no will. Because there’s no will that means that there’s no particular person who’s been nominated to serve.
There is a whole statutory system about who has a priority, but we’re addressing that separately. What I wanted this video, is just simply assuming that you’re a person who is eligible, should you serve as the administrator.
So let’s assume you’ve got a statutory priority and so you could potentially serve. The first thing that you’re going to need to know because you’re going to be confronted with us at the very beginning of probate is you’re going to have to post the bond. A bond is simply an insurance policy in which you got a company that saying look if you serving as the administrator cause a loss to the estate and the beneficiaries need to be made hold then we’re going to use the insurance policy to make them whole. And courts require this unless all of the beneficiary sign a bond waiver, now if you may be able to accomplish that if you can that’s great, but if not know you have to post bond. In order to get a bond issued you’re going to have to fill out what really amounts to a credit application. If that’s something that you don’t want to do for any reason at all; you don’t like it because you feel like you’re giving up your privacy, maybe you know you got terrible credit and your concerned the bond will never get issued. Just don’t serve it may not be the right role for you.
Let’s assume that’s not an issue for you. You’re going to do this, the bonds going to get issued, and you’re going to get your letters of administration. You’re going to serve as the administrator of the estate.
What you can expect when you serve as administrator
When you’re the administrator of the estate you have certain duties the very first of them is you’ve got to gather up and take control and title to all of the assets in the estate. That means there’s work that you’re going to have to do. When I say you, I mean you personally, this isn’t something that your attorney can do, or your CPA can do. It’s not something you can delegate to anybody else, you’re going to have to go to the bank, or the brokerage, or the mutual fund company. Whoever it may be and you’re going to have to fill out their forms, present them with certified copies of your letters in order to actually get these assets, you will have to get them re-titled and make sure they are actually held by the estate that you’re in control of.
The flip side to this is there maybe creditors who appear and there may be claims are filed in the estate that say there are certain people owed money for whatever the reasons maybe. There may be medical bills, or there could be unpaid credit cards, it could be any number of things. Well you’re going to have to deal with that, and I don’t mean you have to deal with that alone. There’s almost always discussions with us about whether or not these claims should be paid, and if the whole thing should be paid or some part of them. That’s fine but understand you can’t just send this to your attorney, and say take care of this for me. This is a decision that you have to make.
If there’s real estate in the estate, you are the person who is responsible for selling it. Unless you’re a real estate agent yourself, you’re not the person who is actually going to sell the property, but you’re going to be responsible for finding a real estate agent, working with that real estate agent making sure the property gets listed, gets marketed, and ultimately gets sold. You can’t just fob this off on somebody else. This is something that you yourself have to get done.
As the administrator I guarantee you will have to file at least one fiduciary income tax return for the period that you are serving. You’re almost certainly going to hire an accountant to do this for you. I don’t want you to think that you, yourself have to prepare the return, but what your account will most certainly do is come to you and say okay these are the documents that I need and I may need an explanation about why certain things were done, simply so they can prepare that for you. So understand this is something that you are going to have to work with your accountant to get done.
Family Attitudes Towards the Administrator of the Estate
The next thing I want to discuss about whether or not you should serve is simply attitude and what I’m really talking about is the attitudes of the beneficiaries or heirs where we’ve gotten administrator. Sometimes I have clients who to come to me thinking that all of these other family members, and it’s always family members when there’s an administrator, are going to be grateful for what they’ve done.
What I can tell you is it’s nearly always the polar opposite. Nobody is going to thank you.
You can expect that nobody is going to thank you. You can expect that what you’re going to hear a lot of carping and complaining, and maybe some whining, that the whole thing is taking too long. That it sounds like it’s going to cost too much. Well there’s certain statutory procedures that just simply have to be followed. Probate is not fast, you should not be surprised when you hear from one or more of the heirs that they heard from:
- their friend or
- this other family member or
- their drinking buddy or
- this guy they know who lives in another state
that things should be moving a lot faster than they are. It just comes with the territory, and if you don’t want to hear that, or if you can’t put up with it, just don’t take the position because I can guarantee you it’s coming.
Getting to the Close of the estate
Moving on in our discussion, let’s say we made it through all that and we are getting to closing the estate when you close the estate you’re going to have to file a first and final account.
Now that’s something that we are going to prepare for you, but what you need to know is in order for us to do this, we’re going to need all the financial records. These are financial records that you personally have. It’s not hard to keep them, not hard to gather them, it’s not hard to deliver them to us to complete the accounting, but I’m telling you it’s something that’s going to happen. These accounts don’t get put together by magic, they get put together based on the documents that are in your possession.
Now it maybe that you’re able to get waivers from all of the heirs and if so that’s fine. Similar to the posting the bond, expect if you send anybody waivers they’re going to ask me why this is necessary or appropriate in their case. If they all choose to do it that’s great fantastic, we skipped by having to provide an account, but understand the likelihood is you’re going to have to account.
Following the Advice of Legal Counsel
Lastly what you need to consider is now not the attitude of the heirs, but your personal attitude Referring to is can you cooperate with your attorney during my career the vast majority of our clients have been good people, who get done in a reasonable period of time the things they need to get done. So when I say cooperate In about jumping the moment your asked for something. I’m not asking you to do to it anyway to give up your ability to make decisions as they need to be made during the probate process.
What I am talking about following directions when you’re told in in straightforward language did the law requires you to do something. I know that sounds ridiculous too many people who were listening to this, but I can tell you during my years of practice, I’ve had very few, but I have had a few clients who have simply outright refused to do with the law requires them to do. We have told them X must occur and it must occur in this period of time. Rarely, but I have had some clients who simply said no, that’s not what the decedent would have wanted, or they personally knew better, and they simply weren’t going to get it done. That’s a recipe for a disaster. If you’re not willing to follow the legal advice that you’re given where you’re being told you absolutely must do something just decline the role, it’s not the right one for you.
I do want to be clear there are times where there’s discretion, that you can do something, or you can decline to do something that is a discussion to be had with an attorney. And just because you get a piece of advice that doing one thing is wise and another thing is unwise, it doesn’t mean that you have to do it. Reasonable Minds can differ, that’s fine, I just want to be clear that if you are not going to follow directives when you were told explicitly, this is something must be done, then this is not the right role for you.
Now for the vast majority of people, who are going to say all of course if I’m told that the law requires me to do I’m going to get it done, or if there’s something that’s maybe not totally clear I’m going to have a discussion with my attorney, and then I’ll make a good decision, that’s great and this is an appropriate role for you. So those are the factors to consider in deciding whether or not you should serve as administrator of the estate.
AttorneyThe Grossman Law Firm, APC · 525 B Street, Suite 1500, San Diego, CA 92101 · (951) 523-8307