An executor is a person that has been named as such in a will by a deceased person. He or she is responsible for:
- Settling the deceased’s affairs, which include debts and liabilities.
- The executor temporarily owns the deceased’s estate.
- Carrying out the directions that are contained in the will.
As an executor, it is your duty to account for all of the deceased person’s debts, assets, liabilities and taxes. You have to pay off all of what the deceased owes, including any taxes the deceased may owe. All of that has to be done while following the deceased’s instructions in the will.
An executor must take to pay not only taxes that are owed by the deceased but also file the deceased’s tax returns.
While there are no estate taxes, there are tax consequences when someone passes away. The deceased is deemed to have disposed of his or her assets a minute before he or she died, so the executor must file a Tax Return in the Year of Death.
The return must report the final income for the deceased from January 1of the year of death, up to and including the date of death.
The executor is accountable to the beneficiaries and responsible for paying off the debts. If the executor doesn’t pay off all of the debts before distributing the estate to the beneficiaries, he or she may be held personally liable.
Even though an executor has been named in the will, this person may decline the duty.
What is a personal representative?
Personal representatives can be executors or estate administrators.
An estate administrator looks after the estate if the person dies without a will (intestate), an executor declines the duty, or there is a will and no executor is named.
Usually, the court either appoints an estate administrator, or a person makes an application to the court to be named estate administrator.
What duty does a personal representative have?
A personal representative has the same duties as an executor or an administrator. They include:
- To take possession of the assets;
- Pay the debts;
- Look after insurance matters;
- Keep proper accounts; and
- The personal representative also stands as way station between the deceased and the beneficiary.
Who can be an executor or personal representative?
Anyone named in the will that is over the age of majority in the province. It’s also good if the person doesn’t have a criminal background, because they may be disqualified. Usually a family member or a friend is appointed that the deceased trusted.
What is an estate?
An estate is the possessions the person who died owned at the time of death. Those can include money, a house or debts.
However, there are some things the estate excludes:
- Jointly owned property or bank accounts;
- Insurance policies;
- RRIF’s or RRIP’s;
- Possessions the deceased owned that specifically mention a beneficiary.
The executor has to follow provincial laws and rules when administrating the estate. Executors are responsible for settling the estate, including debts, and if they fail to do so, the liability attaches to them.
Executors should consult with lawyers and other professionals for estate administration, as there are many legal issues surrounding the administration of a will.
Duties as an Executor