When someone passes away their estate must be settled. “Settling” an estate involves two things: paying debt that the estate owes and distributing estate assets. This means that someone must identify the property in the decedent’s estate, figure out the debt owed by the estate, and make sure asset distribution and debt payment are cared for in an orderly manner as required by the Mississippi law. The job of caring for the estate of a decedent is the job of the personal representative. Depending on the circumstance of how the person was appointed or the jurisdiction, a personal representative is also referred to as the executor or estate administrator.
Responsibilities of the Personal Representative
Even if the estate is small, there are many tasks that the personal representative is required to perform or ensure are performed before the estate can be closed. Each of these tasks are in furtherance of the overall goals of the estate administration process of paying debt and distributing assets.
- Assume control of property. The personal representative must take control of estate assets. This means that they must figure out what assets are part of the estate. For example, an estate might have real estate such as the house in which the decedent lived as well as other real estate. It is up to the personal representative to identify the assets, their location, and make sure they are secure. If property is not properly secured or properly taken care of during the administration process, the property may get damaged or something else might happen to it that would result in its value diminishing. Mississippi Code Ann. § 75-3-708. The personal representative’s job is to preserve the value of the estate.
- Inventory and appraise the assets. Within three months of appointment, a personal representative must create a formal inventory of estate property. Mississippi Code Ann. § 75-3-705. The inventory is not merely a list of estate assets. The list must also include the value of the assets. This is critical, because this document will let the court and other interested parties know the value of the estate. From this inventory, the personal representative will understand what property is available to pay debt and expenses and what might be available to distribute to the decedent’s beneficiaries and heirs.
- Pay estate debts. One of the main responsibilities of the personal representative is to pay estate debts and estate expenses. Debt refers to bills that the decedent left behind, including the medical bills associated with the decedent’s last illness, as well as bills such as outstanding loans, credit card bills, and other consumer debt. Expenses include bills related to the decedents funeral and burial as well as expenses associated with the administration of the estate. The personal representative must use estate assets to pay bills. If there is not enough money in the estate to pay the estate’s debt and expenses, the personal representative must follow state law which sets forth the order of priority for debt payment. Note that the personal representative is not required to pay estate bills out of their own assets.
- Distribute estate assets. The final major responsibility of the personal representative is to distribute the assets that remain in the estate after bills and expenses are paid. The decedent’s will controls asset distribution. If the decedent did not leave a will, the personal representative is required to look at Mississippi’s intestate succession law to determine how to distribute assets.
The role of the personal representative in the administration process is significant, requiring an understanding of the legal requirements and attention to detail. It also can require a significant amount of time. As a result, personal representatives are not required to work for free—even if the personal representative is the surviving spouse, child of the decedent, or other close relative.
The law allows personal representatives to receive “fair” compensation. To receive payment, the personal representative must submit a request to the court. Generally, the court will approve the request and deem it fair unless an interested party objects. If that happens, the court will review the compensation requested to determine if it is reasonable based on the activities that the personal representative performed for the estate.