When a loved one or close friend passes away, there’s always a period of grief and mourning. Whether it was expected for a long time or happened completely by surprise, none of us are quite prepared for the finality of a death. If the person themselves had prepared though, they not only had a will, but had someone specifically in mind to carry out their wishes after they were gone.
This person is known in law as an executor (sometimes the feminine ‘executrix’), and they are the person who a testator (the author of the Will) decides to carry out the administration of their estate. Being chosen as someone’s executor can be an honour, but to quote Spider-man, “with great power comes great responsibility.”
So what happens when you’re chosen as someone’s executor? You may be overwhelmed, especially if you were not informed of your role prior to the person’s death, and you may be lost as to where to even get started. Legal advice is always the best answer, but this article is intended to provide some basic information that might be helpful as you move forward.
What should an executor do first?
Once you learn that you are a person’s executor, you will be required to make some important decisions fairly quickly. Funeral, burial, and cremation arrangements can all be under an executor’s control, and this is understandably a lot to deal with at an emotional time. Funeral homes are helpful, and can provide guidance in their initial appointment.
As an executor, it is important to follow the deceased’s wishes as closely as possible. Were they from a religion or culture that prizes burying quickly? Had they expressed desire or made prior arrangements for a specific method of burial? Are there clear wishes about the type of service that they wanted (think guest-list, music choices, open casket vs. closed, etc.), if they even wanted a service at all?
Remember that funeral arrangements can be costly, often ranging from $10,000 or more depending on the type of service. These expenses can ultimately come out of the person’s estate, but you as the executor may need to be reimbursed. A funeral home can also assist with some of the government paperwork, such as applying for Canada Pension Plan death benefits.
There are other immediate needs that may need to get sorted as well. Did the deceased have minor children who now need a safe place to stay (if another parent is not available)? Are there any pets that will need food and shelter immediately? Did the person have any dependents who relied on them financially, and who now risk losing their food and shelter without that person’s support?
As those closest to the deceased are grieving, emotions may begin to run high, and so the executor should work quickly to make a list of the contents of the deceased’s estate. The will may provide guidance, but this includes tallying assets such as any property, owned vehicles, bank accounts, etc.
Handling the administrative work
The thing that most surprises people about death is the amount of paperwork involved. The funeral home can assist with some of the immediate paperwork, such as obtaining copies of the death certificate and applying for death benefits, but following that there is a tremendous amount of administration to be done in the following days and weeks.
Creditors and financial institutions need to be informed of the passing. That means informing banks, closing accounts, informing credit card companies, paying off any outstanding bills, and then cancelling any services that no one else is using such as a cell phone plan, cable and internet, etc. Of course, ensure first that no one else is using these services before cancellation.
There are also various government services that will have to be notified about the passing in order to cancel the person’s identification and ensure that their identity is not stolen. This includes their drivers’ license, health card, passport, and any other government-issued ID that they may have carried (firearms license, hunting or fishing license, etc.)
Dealing with the big stuff
Mark Twain was right – the only two certainties in life are death and taxes, and being an executor involves both. The executor will be responsible for preparing the deceased’s final tax return as they work to wind down their estate.
The financial matters of a Will can be quite complex. Most Wills are required to go through the Certificate of Appointment of Estate Trustee (still commonly known as ‘probate’) in order to have a Court validate the Will before any disbursements are made. This process can be time-consuming, but it is required in many situations, and the validation of the Will may help avoid any fights between beneficiaries.
An executor also needs to deal with the deceased’s finances, and even tallying those finances can be tricky. If the person’s affairs were simple, such as only using one financial institution, things may be straightforward. However if they had a series of investments in other places, multiple accounts, offshore accounts, or complicated debts, things can get trickier.
Executors are also responsible for letting beneficiaries know that they are beneficiaries, and that they will be receiving money or gifts that were outlined in the Will. However, disbursements are not made until taxes and debts are sorted out first, so the executor’s first job is paying off those debts and sorting out taxes before they get the fun of ‘playing Santa.’
The two primary questions on most executors’ minds are “can I get paid for this?” and “how can I receive help?” To answer the first question – yes, executors can be compensated for their efforts. There is a standard formula of 5% of the total value of the estate after debts and taxes are paid, however this is not a hard and fast rule and each situation may differ. Also, in the case of multiple executors that 5% is divided between them, not paid to each individual.
As for the next question, there are plenty of people available to assist. From the kind folks at the funeral home to accountants and financial professionals, there are well-trained individuals who handle these matters regularly, and who would be glad to assist you in navigating this challenging journey.
The other step is working with the right Wills and Estates lawyer. A lawyer can help guide you through the process step-by-step, ensuring that the right parties are notified and that the steps are taken in the right order to help things go smoothly. Just like our Will drafting practice, we routinely help executors in the Windsor-Essex and Chatham-Kent Regions through the estate administration process. Contact us today to set up a consultation.