SETTLEMENT TIMELINE FOR ESTATE EXECUTORS

Being named as executor on behalf of a friend or loved one’s estate can be both challenging and fulfilling. While laws vary from state to state, here is our helpful guide of a suggested

timeline for your estate settlement.

MONTHS 1 – 3

● Safeguard personal effects. All property must be secured and held until you settle the estate.

● Collect all documents and read the will. You may need copies of: death certificate, birth certificate, marriage certificate, property titles, insurance policies, and brokerage, bank, and retirement account statements.

● Assess and insure items of value. Work with appraisers and insurers to determine the value of items and protect them during the settlement process.

● Record the probate petition and will. Even if the estate is held in trust, you’re still required to file the will in probate court and officially be named as the estate’s executor.

● Close personal accounts and memberships. Keep an eye out for accounts that are subscribed to automatic bill pay and cancel those that are no longer needed.

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MONTHS 3 – 6

● Collect financial assets. Retirement accounts, savings accounts,

stakes in business partnerships – all financial interests should be

identified and moved into the estate account.

● Evaluate the estate’s short-term cash requirements. Determine

how much cash on hand the account will need during the probate or

settlement process. These could be legal, utility, maintenance or

insurance premiums. Keep a sufficient amount of liquid capital or sell

some items to pay for contingencies.

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MONTHS 6– 9

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● Locate assets and determine date-of-death values. This means

doing a thorough inventory of all items of value and quantifying the

estate’s total net worth.

● Allocate personal property to beneficiaries. Heirs may be

pressuring you to begin distributing assets. While you can’t settle all

inheritances at this time, you can relieve some of the pressure by

distributing tangible, personal effects – many of which have emotional

value.

● Record estate probate inventory, documents and assets. Create an

itemized inventory of any property, bank accounts, real estate and

debts. Submit this to the court.

● Discharge estate tax lien. The government issues an estate tax lien

against all real assets held in an estate. Before you can transfer or

liquidate those assets, you need to get the lien released.

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MONTHS 9 – 12

File tax forms and make partial distributions. Please consult your CPA for state specific requirements. Pertinent forms can include:

● Federal Estate Tax Form 706

● State estate taxes

● U.S. Income Tax Return for Estates and Trusts Form 1041

● U.S. Gift (and Generation-Skipping Transfer) Tax Return Form 709

● Information Regarding Beneficiaries Acquiring Property from a Decedent Form 8971

● Final Individual Income Taxes Form 1040

MONTHS 12 – 18

● Settle outstanding expenses. As you near the end of the process, it’s time to pay any remaining creditors or debts that the estate maintains or has incurred.

● Prepare and file final accounting. This involves creating a detailed report that summarizes how you’re handling and disposing of the estate’s assets and obligations.

● Obtain estate-tax closing letter(s). The government issues this form to verify that it has reviewed and accepted an estate’s income tax return, and is generally required before you can settle the estate.

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MONTHS 18 – 36

● Disburse contingency reserves after settling all financial obligations.

Once you’re certain you’ve paid all expenses, you can liquidate the

reserve account.

● Distribute final assets to beneficiaries. Now that you’ve done all this,

it’s time to issue final payments to all interested parties.

● Close the estate and petition for discharge as personal

representative. Finally, after all debts, expenses and taxes have been

accounted for, you may petition the court to be released as executor,

including any legal liability.

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COURT INVESTMENT SERVICES

4695 Macarthur Ct. Ste 1100

Newport Beach, CA, 92660

(800) 880-2760 contact@courtinvestmentservices.com