How Does an Executor of a Will Split Up Property?

By Laura Payet

How Does an Executor of a Will Split Up Property?

By Laura Payet

Your executor, sometimes called simply a personal representative, is the person you designate in your will to administer your estate after your death. Your estate includes everything you own when you die, including any real estate, personal property, and bank or investment accounts. They split up property among your beneficiaries according to your will's instructions, so it is important to be as clear as possible in your will to avoid any confusion or conflict. How they ultimately distributes the property depends on your will's terms.

Document detailing distribution of property

An Executor's Responsibilities

Accepting the position of executor for someone's estate is a serious decision that comes with heavy and sometimes time-consuming duties.

  1. The executor files the will with the appropriate probate court and waits for the court to find the will valid.
  2. The executor organizes and inventories all of the estate's assets and liabilities.
  3. Before distributing any property, the executor pays any outstanding taxes or debts. If the estate lacks sufficient cash, they must sell assets and use the proceeds to settle all obligations.
  4. After paying the debts, the executor handles specific bequests, or those that involve a particular asset going to a particular person.
  5. The executor fulfills more general bequests. These might involve the rest of the jewelry or art, for example.
  6. The executor turns to residuary bequests. The residuary estate is anything left over after the fulfillment of specific bequests. A residuary bequest might read, "I leave the remainder of my estate to my spouse and children."

Where there are multiple beneficiaries for the residuary estate, the executor first determines the overall value of the entire estate to calculate each beneficiary's share. This step includes obtaining appraisals for specific pieces of valuable property such as jewelry, artwork, keepsakes, and furniture. They can then distribute items of property with comparable values among the beneficiaries.

Complications for the Executor in Splitting Up Property

When it comes to distributing property that is not subject to specific bequests, open communication between the executor and the beneficiaries can help determine which beneficiaries should take which piece. In the real world, however, conflict often arises around questions of who should get what, especially when it comes to items of sentimental value. If the parties can't reach agreement, the executor can ask the probate court to step in and make a decision.

Real estate can also cause complications for the executor. If the estate's principal asset is real property, such as a family home, the executor might have to sell it to meet tax and debt obligations, particularly if the property itself is subject to liens and taxes—and even if the property is subject to a specific bequest. In this situation, they divide and distribute any remaining proceeds among the beneficiaries. Additionally, in an issue more of concern to the heirs, if a single piece of property, such as a home, is left to multiple beneficiaries, then that property's multiple owners must agree among themselves whether to sell it or keep it. Moreover, if the property has a mortgage and the heirs are close family members, then the heirs become responsible for paying the mortgage. If the heir is not a close family member, then depending on the terms of the mortgage, the lender may accelerate the debt so it is due in full upon transfer.

The best advice is to be as specific as you can when preparing your will. You can enlist the aid of an attorney to prepare a will that ensures that your executor can carry out your wishes easily after your death.

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