Executor Duties and Responsibilities
Estate administration is the process during which the affairs of a decedent are settled and their property distributed. The process is managed by the personal representative- also known as the executor. In Maryland, the personal representative is appointed by the Orphan’s Court which serves as the probate court and has jurisdiction over estate matters. Md. Code, Est. & Trusts § 2-101. In managing the estate administration process, the personal representative must perform several tasks that fall into three general categories: manage assets, pay debts, and distribute assets. Md. Code, Est. & Trusts § 7-101.
Duties and Responsibilities of a Maryland Personal Representative
Regardless of whether the decedent left a will, the person wishing to serve as personal representative must file a petition for probate with the court. The petition must be filed in with the Orphan’s Court in the county where there decedent was domiciled at the time of their death. If the decedent did not have a domicile in Maryland, then the county where they had property. Md. Code, Est. & Trusts § 5-103.
Once the court approves the petition, the personal representative has the legal authority to represent the estate and move forward with the tasks required to settle the estate.
- Manage estate assets. During the administration process, the personal representative has control over estate assets. To assert control, they must first identify which assets are part of the decedent’s estate. Some of the major items in the estate may be the decedent’s house, townhouse, or condo, personal property inside the house, vehicles, and bank accounts. The personal represent must create an inventory of assets that includes their appraised fair market value. Md. Code, Est. & Trusts § 7-201. The inventory must be submitted to the court. It is important that the personal representative can distinguish between probate assets and non-probate assets. For example, retirement plans, life insurance proceeds, and property held in trust are NOT probate assets and will not come under the control of the personal representative.
- Pay estate debts and expenses. A goal of estate administration is to settle the decedent’s affairs, including their debt. Whether the debt includes medical bills, credit card bills, or taxes, it is not forgiven upon the death of the decedent. The decedent’s estate is responsible for paying it. It is up to the personal representative to manage the claims process and make sure that claims that are timely filed and valid are paid to the extent the estate has money to pay them. In addition, the personal representative is responsible for paying expenses that are incurred during the administration process. For example, there are filing fees associated with administration and there may be fees for professional services. If there is not enough money to pay all claims and expenses, the personal representative must follow state law related to the order debts and expenses must be paid. Unfortunately, low priority expenses will not get paid.
- Asset distribution. Distribution of assets occurs at the end of the administration process after debts and expenses have been paid or otherwise settled. The personal representative must refer to the decedent’s will to determine how to distribute assets. If there is not a will, the personal representative must follow Maryland’s rules of intestate succession to determine how to distribute assets. For example, if the decedent is survived by their spouse and minor children, the spouse would receive 50% of the estate and the children would share the remaining 50%.
Personal Representative Compensation in Maryland
For their work, personal representatives are paid. It does not matter if they are the decedent’s spouse, adult child, sibling, or someone other than a family member. Personal representatives are not required to work for free. The amount of compensation due is based either on terms of the will or on the statutory requirement. Md. Code, Est. & Trusts § 7-601.
If there is no will or if the statutory requirement results in a greater fee than the will, the statutory requirement controls. The statute does not give a formula for determining the amount the fee must be. It does, however, provide the maximum amount that a personal representative can be paid under the statute.
Note that the court has discretion to approve a fee that is more than the will allows. In addition, it can also approve a fee that is less than the maximum amount that the statute allows. The court will look at several factors to determine what is reasonable in each case. If the personal representative is not satisfied with their fee, they can appeal.