When a mother passes away, the emotional repercussions will generally overshadow financial considerations. However, these concerns must be addressed. Distributing assets and settling debts can be complicated, especially since certain assets may have sentimental as well as financial value. The process of settling estates is defined by state law, so standards vary. Estates are generally settled by going through the probate process. Some states permit certain estates to be settled with a simplified, expedited probate process.
Initiate the probate process. The probate process is overseen by a court. It begins shortly after the decedent dies. You must petition the appropriate court to initiate probate. The petition process will vary based on where the decedent lived. If your mother had a will, you must present that document to the court for review. If the will complies with the state’s will requirements, the court will declare the will valid.
Naming an Executor
If there is a valid will, the court will appoint the named executor to manage the estate. If there is no valid will, or a valid will does not name an executor, the court will appoint someone to oversee the estate. Generally, a court will select a surviving spouse or adult child to oversee an estate. Apply to the probate court for the estate representative position. Be sure to present any qualifications that make you best suited for the position. If an executor was named, have him surrender the position by petitioning the court prior to your asking for the role.
Executor Fiduciary Duties
Review the executor’s fiduciary responsibilities. As an executor, you owe a fiduciary duty to the heirs and beneficiaries of your mother’s estate. This means you are required to manage the assets of your mother’s estate for the benefit of all of the beneficiaries and not take any action that would benefit yourself at the expense of the others. This can be difficult to do, especially since you are likely to be a beneficiary to your mother’s estate as well. Therefore, it is important that you communicate with all of your mother’s heirs about the actions you are taking and avoid the appearance of impropriety by not taking actions that would solely benefit you unless absolutely necessary.
Before the distribution of any of the estate’s assets, you will be required, as executor, to take inventory of your mother’s estate to determine its value. The estate is comprised only of probate property, such as real estate and financial accounts held solely in your mother’s name. The inventory will be submitted to the probate court and must contain “reasonable detail” regarding each item. The inventory should detail the market value of each item as of the day your mother passed away. The inventory should also detail any outstanding loans that have estate property as collateral.
Gather all information about outstanding debts. Prior to distributing property to your mother’s beneficiaries, you must pay off all of her outstanding debts. This includes any estate taxes. The debts are paid from the assets contained in the estate. If your mother’s assets are not enough to settle her debts, you will generally pay all of the estate administration costs first and then all of her funeral expenses. If assets remain, pay all federal taxes and then any remaining debts.
Distribution of Assets
Distribute the remaining estate assets subject to the terms of the will as approved by the court. If there is no valid will, divide the estate assets according to the appropriate state’s intestacy code. Under most intestacy codes, you will divide the estate assets between your mother's surviving spouse and her surviving children, based on a percentage of the estate's value.