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1. Executors, How to Quit When Your Job Makes You Sick
2. What Do You Tell Executors?
1. Executors, How to Quit When Your Job Makes You Sick
By Edward Olkovich
Thomas was sitting in my law office and was a little nervous. He was an executor with a problem he wanted me to fix.
Thomas sighed and said, “This is the third year I’ve been handling this estate. You will be the third lawyer I hire. I hope you will be the last one so I can end this nightmare.”
I asked, “What seems to be the problem?”
Thomas explained, “I sold all the estate property. The money is sitting in the estate account. The estate beneficiaries want me to pay it all out.”
“It has been three years,” I replied, “Why won’t you pay it out?”
I sensed Thomas had a lot of anger inside. I thought I’d let him do the talking, or he may explode.
Thomas said, “I am fed up. I don't want to do this job anymore. I just want you to tell me how I can quit being an executor. Is it true I need permission from someone?”
I asked, “Is that what your last lawyer told you?”
Thomas replied, “My last lawyer told me to pay everyone and stop worrying. He ignored my fears. He told me I could hold back $5,000 in the estate account. That’s what everyone wanted me to do.”
I asked again, “And what did you say to that?”
Executor Fears Are Real
Thomas explained, “For three years I always did whatever the beneficiaries wanted. I did that so they would think I was fair.”
I asked, “What do you mean?”
Thomas replied, “I let the family choose the funeral home, the real estate agent and the tax accountant. I did everything their way. I even agreed to hire the lawyer they wanted. I gave in to them. I let them decide.”
I asked, “Was there something wrong with that?”
Thomas explained, “Yes, I found out later I had chosen the wrong lawyer. He knew nothing about handling an estate. That wasted about one year to sell the house. But at least the house prices were going up. We did not lose money. My co-executor was no help either.”
Co-Executor Issues
I asked, “Didn’t your co-executor help you prepare the house for sale?”
Thomas responded, “He was some help but the day the house was sold my co-executor left the country. He had taken a one year work assignment in England. Now he says he going to get married and stay there. He wants his share of the executor’s fee before he flies out next week.
It was impossible getting my co-executor to sign legal documents. He slowed everything down. The beneficiaries are mad that it has taken so long. We still do not have a final estate tax clearance.”
I told Thomas, “I understand your problem. You do not want to be left holding the bag if any taxes are unpaid. Your liability as an executor is personal. You can end up paying the taxes yourself. You should not distribute the estate without a clearance.”
Thomas said, “Exactly, my co-executor does not care what happens to me. He will be gone. I will be stuck with the income tax problems.”
I asked Thomas, “Have all creditors been paid?”
Thomas answered, “Yes, but I'm afraid. I don't want to distribute the money before I get a final tax clearance. I heard that can take months. I don’t want any more headaches. I want your help to resign as an executor. ”
I reminded Thomas, “It’s not easy to resign once you start working as an executor.”
Here are the steps needed to resign as executor.
Resignation Requirements for Executors (or estate legal representatives):
A court usually needs to accept an executor's reasons for resigning. The court requires
1. the consent of all the beneficiaries
2. court permission (example: health problems could be valid grounds)
3. court audit of your estate financial records
4. approval of any claims for executor’s compensation
5. payment of costs which could be your personal responsibility
Thomas never knew what he was getting into as an executor.
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2. What Do You Tell Executors?
By Edward Olkovich
Should parents show their children their will? Ken Gallinger, the Toronto Star ethics columnist, suggests they should. As an estate lawyer, I typically do not give this advice to clients. However, you should consider the factors in this article before deciding.
Estate planning is personal. There is no one rule that covers everyone. No matter what you may read elsewhere. Even so, there are exceptions to every rule. A cookie cutter approach to estate planning cannot meet your needs.
Your will is a private and confidential document until it is made public. The probate process makes your will public. It is filed with a probate, surrogate or estate court. Then, and only then, is it accessible to the public.
You may provide a summary of your will’s contents to your executor, but it is not mandatory.
Parents Talking to Executors
Parents have plenty of reasons not to disclose what’s in their will. Your child as executor may not:
• be objective in commenting on the parent’s will
• have the background information to properly critique it
• understand the tax or legal reasons for a parent’s estate planning.
On the other hand, getting someone to look at your will has some merit. At least it forces a parent to look for the original will. As parents age, being able to locate the will becomes increasingly important.
Executors Duties Are Confusing
I once had a mother call me about her daughter, Helen, who was her executor. Helen said, “Mom, you cannot sell your property without my consent because I am your executor.” The mother asked me if this was true.
“No,” I said, “your will does not become effective until you pass away. Your daughter Helen, as executor, has no authority or control until then. You can always change your will and your executor while you are capable. You do not need Helen’s permission nor does she need to sign anything.”
Factors For Executor Disclosure
Be careful before revealing what’s in your will. You run the risk of starting a tense family discussion. This can escalate into a family argument.
Your age, health and dependency can make you vulnerable to family pressures. These can be difficult to ignore. Will you be prepared to deal with this type of psychological stress?
Disclosing what’s in your will can raise questions about your estate planning priorities. Your child, who could be your executor, will have different priorities than you. Consider these three factors before telling your executor what is in your will:
1. Your needs – based on your age, spousal status and health
2. Your beneficiaries – how many children/beneficiaries you have and how you treat them in your will
3. Your estate – the type of estate assets you have
Let’s look at this third point in more detail because it is less complicated.
What Are Your Executors Required to Do?
Your executor may not be capable, competent or comfortable administering certain assets. They can always refuse to be an executor.
You should warn your executor about these complex estate administration issues:
• business interests, farm or family business
• burdens of rental properties
• succession of a vacation or cottage property
• special-needs beneficiaries
• maintaining a trust
• substantial debts
• special collections like art or
• foreign assets
These assets/beneficiaries require greater time commitments and expertise from executors. They will need to obtain professional advice.
Consider introducing your executor to your dream team of professional advisors. However, you cannot legally force your executors to hire these professionals.
So how do you educate your executor?
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