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Being asked to be the Executor of a Will<\/a> (or the Executor of an Estate) is one of the greatest possible honours any one person can receive. It is a true testament of trust bestowed upon you by the individual in question. While\u00a0being asked to act as an Executor is certainly a flattering experience, it is important to know this responsibility\u00a0can sometimes require an enormous amount of work\u2014becoming a full-time job in some cases.<\/span>\u00a0<\/span><\/p>\n In the case for most Executors, they will need the support of both lawyers and accountants to get the job done properly. The scope of the task varies greatly, ranging from 10 hours of work to well over 240 hours per year when the estate holds large investments or many rental properties. It is also common that some estates will not be wrapped up in one year either. This is another key factor to consider when accepting the appointment.<\/span>\u00a0<\/span><\/p>\n If you decide to accept the request and become the Executor of a Will, it\u2019s important to understand the commitment that you are making. Executors bear a significant legal burden, and they can be sued for mismanagement of an estate. You want to make sure that you have all the information to ensure that you can fulfill all the duties of an Executor and avoid any issues or legal ramifications.<\/span>\u00a0<\/span><\/p>\n Our experienced team here at RLB understands the duties required of an Executor from firsthand experience. It\u2019s important to us that you understand them too\u2014so you know where you can get the appropriate support if you need it!<\/span><\/p>\n One of your first duties as an Executor will be to identify the beneficiaries in the will and arrange a meeting with them. You will need to notify them that they have been named in the will as a beneficiary. Though this sounds like a straightforward task, there may be a few reasons why you might want professional support.<\/span>\u00a0<\/span><\/p>\n Beneficiaries may become upset when they learn what has been bequeathed to them. Having a professional who is experienced with these types of reactions present with you\u00a0can help to more easily diffuse the situation. <\/span>\u00a0<\/span><\/p>\n In addition to needing mediation support, Executors are also under a legal obligation to locate the beneficiaries (or prove to the court that they have attempted to do so). It is sometimes necessary to place ads in the newspaper\u2014or even hire a private detective! Our team has experience with this process and we know not only what is legally required, but how to provide proof of a proper search.<\/span>\u00a0<\/span><\/p>\n Probate is the process used by the courts to prove that a will is valid and confirms the appointment of the Executor. Applying for probate is not necessary in every case, however many banks will want to know that a will is both legal and valid before they begin transferring assets between accounts. Typically, a lawyer will help you with the application process, however, the Executor will need to gather the required information themselves. This is where help is often welcome.<\/span>\u00a0<\/span><\/p>\n In addition to applying for probate, you will need to pay a probate tax to the province in question and file an information return with the Canada Revenue Agency (CRA). This must be done for every account plus assets valued. For example, any pieces of real estate, plus items like artwork and jewellery. This can be a big undertaking for larger estates.<\/span>\u00a0<\/span><\/p>\n This is one of the more lengthy or ongoing portions of the estate. Estate accounts are similar to a business\u2019s financial statements but with different rules. Estate accounts must differentiate between capital assets and revenue. For example, you may have a beneficiary who is entitled to receive income from a property (revenue), but someone else is going to receive the actual property (the capital asset).<\/span>\u00a0<\/span><\/p>\n Estate accounts require you to provide an ongoing breakdown of all the transactions that have occurred in the estate for the period in question. These statements must be prepared prior to submitting them to your lawyer for passing (approval of transactions) in court. Accountants are your best friends for this job!<\/span>\u00a0<\/span><\/p>\n Just like with a business, if the estate keeps earning income, it must pay taxes on that income. If you are the Executor of the estate, you are responsible for ensuring the estate pays the taxes due before distributing assets to beneficiaries. The government can come after you personally for any taxes owed!<\/span>\u00a0<\/span><\/p>\n Getting the support of an accountant is a vital part of completing tax returns for large estates too!<\/span>\u00a0<\/span><\/p>\n Lastly, the Executor is responsible for the overall maintenance of the estate. This means caring for any properties, keeping track of investments, paying bills, notifying creditors and so on. One of the largest tasks in any estate is relationship management; the Executor must be on good terms with the beneficiaries, banks, lawyers and accountants. They must mediate communication between them and keep the whole group working together\u2014which is often the most difficult job of all.<\/span>\u00a0<\/span><\/p>\n Being the Executor of a Will requires you to conduct yourself with honesty, integrity and reliability. The role of the Executor is indeed a high honor, which means it comes with the highest obligation imposed by law. By default, misconduct or mismanagement is looked upon harshly. Compensation for an executor varies depending on the size of the estate, but the Executor of a Will in Ontario is entitled to charge 5% of the gross aggregate value of the estate. Most of the time, the position is simply about honoring the memory of a dear friend or family member.<\/span>\u00a0<\/span><\/p>\n \u00a0<\/span>\u00a0<\/span><\/p>\n If you are considering accepting such an important position, be sure to consider these five points and contemplate where you will need support. Will you have the time and the skills to take on such a demanding task?<\/span>\u00a0<\/span><\/p>\n \u00a0<\/span>Access RLB\u2019s exclusive Executor Guide<\/a> or contact our team to learn more about how we help support Executors throughout the process. <\/span>\u00a0<\/span><\/p>\n<\/p><\/div>\n1) Notifying the Beneficiaries<\/h4>\n
2) Applying for Probate<\/span><\/h4>\n
3) Keeping Estate Accounts<\/span><\/h4>\n
4) Completing Tax Returns<\/span><\/h4>\n
5) <\/span>Maintenance of the Estate<\/h4>\n