If a decedent named you as executor of the will, you have many responsibilities. An executor fulfills the provisions of the will, which include safeguarding and distributing assets, paying and collecting debts and filing taxes.
When agreeing to be an executor, you are also agreeing to follow the fiduciary duties, which means you will act in the estate’s and beneficiaries’ best interests. If you fail to do so, there are legal and financial consequences.
Fiduciary duties
Along with the typical duties that go along with being an executor, FindLaw discusses fiduciary duties you have, and these include duties of:
- Obedience: Follow the instructions of the court and the will
- Loyalty: Refrain from self-dealing
- Care: Maintain privacy, follow through with required duties, act with forethought and avoid unnecessary risks
- Good faith: Be fair and honest
As executor, you have in your possession money and other assets, and it is imperative you treat them with respect and care.
Potential consequences of failing these duties
According to the Iowa State University Center for Agricultural Law and Taxation, if the judge thinks an executor is not fulfilling fiduciary duties, he or she will remove the executor from the role. The executor may also be personally and financially liable for losses sustained as a result of not carrying out required responsibilities.
For example, if you were to distribute assets before paying owed taxes, you would be responsible for paying the taxes out of pocket. Executors must also pay legitimate debts and expenses prior to beneficiary distribution, so you would be personally liable to pay those debts if you distributed the assets first.