Sandra Reed’s Life Care Planning: Can’t take it with you? Control it from the grave

Attorney Sandra W. Reed answers your life planning questions.

Attorney Sandra W. Reed answers your life planning questions.

It’s a truism that you can’t take it with you; but it’s no less certain that the older most people get, the more they’d like to control from the grave.

Can they? The answer is “yes,” at least to a certain extent.

This is not a proclamation of the second coming or the introduction of a shaman who can make Lazaruses of every decedent. It is a declaration that through the appointment of the proper representative to handle your estate, you can substitute a person who will be most likely to step into your shoes after death and do what you would do if you were there to do it.

Naming an Independent Executor

The Texas Probate Code allows each person capable of making a will to name an independent executor who can deal with the estate without having to go to court except to probate and record the will and to file an inventory, appraisement and list of claims of the estate. The will maker may name a corporation as the executor, but this article will deal only with naming a natural person since that is what most people do. The will maker can name anybody to fill that position and the court must allow that person to serve unless he or she is an unqualified minor or otherwise incapacitated.

That’s a lot of flexibility. And therein lies the rub. Too many people give next to no thought as to the best person to handle their property after they are gone. Frequently, this leads to the appointment of the spouse or the next-of-kin without any careful analysis of whether the individual’s experience, skills and inclinations make him or her a good candidate for the job.

What Does the Executor Do?

The executor represents the estate before the probate court. Usually, the initial act is to have the original will filed for probate. Since almost all courts in Texas require that the executor be represented by an attorney, the executor must hire a lawyer to assist in his or her duties.

The executor is responsible for identifying, collecting and safeguarding the property of the estate, determining its value and distributing it to the persons named in the will as the beneficiaries of this property. The executor is responsible for filing tax returns and paying out of the estate the tax obligations. If any claims are filed against the estate, the executor must determine what claims are valid and pay those.

In some instances, assets may have to be liquidated to pay claims or to make distributions in accordance with the will provisions. Therefore, the executor could be called upon to sell items like stocks, bonds, real estate, even furniture or vehicles. The final act of the executor is to file with the court an accounting of the property through a document referred to as an Inventory, Appraisement and List of Claims.

Given all these duties, one should understand that in appointing an individual as an executor, you are bestowing more responsibility than honor. The work can be demanding and complicated.

Personal Attributes to Consider

Choose a person to act as your executor whose skills and temperament match the tasks that executor will perform. What attributes are important to consider in naming the person to manage your estate? They are various, of course, but central should be: (1) sound judgment; (2) impartiality; (3) financial ability and responsibility; (3) integrity; (4) experience; (5) knowledge; (6) stability; (7) loyalty; and (8) trustworthiness.

The choice of one’s executor is always a personal one that takes into account an individual’s unique circumstances. There is no consensus on who makes the best executor, even among lawyers. The best approach is to analyze the specific circumstances of the estate and its property in conjunction with the unique qualities of the persons being considered.

The expense of posting a bond equal to the to the value of all personal property plus the amount of revenue it will produce to protect against the executor’s failing to perform his or her duties comes out of the estate assets. For this reason, most people prefer to state that the executor will be allowed to serve without bond.  The absence of a bond makes it doubly imperative that the executor chosen is trustworthy.

John Doe’s Choice

John Doe examined his family to determine the right person to manage his estate. His niece, Harriet, who is a lawyer certainly possesses the skills and experience. However, she lives in Baltimore and would have to establish an agent to accept process in Texas to serve, not to mention the expense and inconvenience of travel back and forth to take care of the business of the estate. Harriet is not a good choice.

Doe’s son, Richard, is the oldest and expects to be chosen due to his seniority. Unfortunately,  Richard and the youngest, Billy the Kid, never got along. Richard adores his sister, Kathryn, so much John fears Richard would favor her over the other siblings. Richard is ruled out because he lacks impartiality.

Kathy, whose personality and affectionate nature make her everybody’s favorite, at 30 has already been married three times and changes jobs every year or so. Kathy doesn’t meet the stability test.

John’s wife, a talented artist, has never balanced a checkbook, hates paperwork and is famously disorganized. John feels guilty not naming her but he realizes in the long run he will do her a favor not to do so.

John is filled with despair until he remembers his business partner, Joe, who has a degree in business administration with a minor in accounting, is loyal, capable, honest and impartial. In addition, Joe is a born diplomat and John realizes Joe’s soothing manner will help avoid potential skirmishes between his children. John obtains Joe’s agreement to serve with the understanding that Joe will receive a modest fee for his efforts.

Sandra W. Reed is an attorney practicing in Glen Rose. She is of counsel with the elder law firm of Katten & Benson in Fort Worth. If you have any questions, you may contact her by phone at 254-797-0211 or by email at swreed2@yahoo.com

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