What is an Executor of Estate?
One of the decisions that must be made when drafting your Will, is who to name as Executor of your Estate. An Executor is an individual (or an entity such as a trust company), named in the Will, who will administer your estate. This involves everything from collecting your assets, opening an estate checking account and paying the final debts and expenses of your estate (funeral bills, final utility bills, etc.) to making sure, the beneficiaries receive the net assets of your estate.
Benefits of Joint Executors
As the Testator, you can name more than one person, as Joint Executors, to administer the estate. There can be some benefits as well as pitfalls to this approach, and the right decision will vary depending on your family and financial situation. Appointing more than one Executor can help to spread out the duties required of the Executor. This can be particularly beneficial for Executors who have full time careers or obligations, which make it difficult to find time to fulfil their estate administration duties.
Another advantage of Joint Executors is that you can assure the executors have the necessary financial expertise as well as the family background and history, to carry out your wishes. This situation occurs most often when a child is named co-executor along with a trusted professional that has worked with you, such as an attorney, or an accountant. Naming a professional will incur additional expenses for the estate.
Naming joint Executors, can also cause tension or resentment within the family. There are many decisions to be made by the Executors such as how to value assets for estate tax purposes, when and how to pay taxes, and when to make distributions to beneficiaries. Joint decisions also require joint action, which may be difficult if the executors do not live close to each other (or even in the same state). Each decision required by joint Executors increases the potential for disagreements. Also consider that in Pennsylvania, an Executor may be held liable for actions taken on behalf of the estate.
While an Executor is generally not held liable for the actions taken by their Co-Executor, they may be required to make a claim against the Co-Executor to protect the estate, or risk liability. Pennsylvania allows Executors to take a reasonable fee for the administration of the estate. Often when children act as Executors they waive this fee.
Joint Executors may disagree on whether a fee should be taken or how it should be split. When deciding whether or not naming joint Executors is the right option, consider the relationships between the executors if they are family (do they cooperate well or have a history of disagreeing), their experience or knowledge when dealing with financial matters, and whether your bequests in the Will could create potential disagreements between the Executors.
Contact a Will Attorney in Pennsylvania
If you are considering this as an option, make sure to discuss all of these issues with your Will Attorney when drafting your Will. For more information contact our office at 717-232-4701