When helping to administer someone else’s estate, you act in a fiduciary capacity. In other words, you act for the benefit of someone else. The name for your role in administering the estate depends on what you are in charge of managing. If someone named you as the administrator of a will, it makes you an executor. If someone placed you in charge of a trust, that makes you a trustee.
It is possible for you to play more than one administrative role in managing someone else’s estate. For example, you can be the executor of a will and also a trustee. In many respects, your responsibilities are similar regardless of what specific role or roles you have to carry out.
Debts
It is not only a person’s assets that you must manage as part of estate administration. You also must deal with the debts that the decedent leaves behind. Certain bills, such as real estate taxes or property insurance, require immediate payment, otherwise harm to the estate could result. As an administrator, it is your job to decide which payments should receive top priority.
Taxes
As an administrator, it is your responsibility to file income taxes on behalf of the estate. The law considers the estate of a deceased person to be a separate tax-paying entity. After a person dies, his or her Social Security number is no longer valid. Therefore, before you can file taxes on behalf of the estate or trust, you must obtain an entirely new tax identification number.
Bequests
Before distributing any property to beneficiaries, be sure that you have taken care of other obligations, not only taxes and debts but also expenses associated with managing the estate. If insufficient funds remain to cover these obligations, it is possible that you could be personally liable.
Administering someone else’s estate involves serious responsibilities. You may ask for discharge from your administrative duties if you feel that you are not up to the task. However, you cannot give up your role without approval.