topic | first days after death

Step 8: pay critical estate expenses

Maintenance of financial obligations of the estate is part of the executor's legal responsibility to care for the estate residence until it is allocated. There may be critical payments that are due or overdue that must be tended to immediately to ensure the continued value and safety of the residence.  Additional details on maintaining the finances of the estate are covered in the Topic: Organize Finances and Pay Bills.

Managing finances may seem challenging in general! The following activities are practical and simple. You can do this!

Activity 1
  Pay Critical or Necessary Household Bills

Critical bills may include utilities, mortgage payments, rent, or insurance payments. Now is a good time to determine whether the deceased had mortgage insurance. This can be verified with the mortgage company or insurance broker. Use Real Estate Records, Deposits Deductions, Dues Subscriptions, and Other Payments as guides for tracking when bills are due and what bills have been paid.

It may be necessary to use personal funds to pay critical expenses. An estate checking account is created in the Topic: Gather Information and Make Notifications. Until this account is established, expenses may need to be paid by the executor and reimbursed later. Record the expenses carefully as described in Activity 2.

Some businesses may require that any continuing services are changed to the name of the executor so as to identify the person responsible for paying the future fees.

Activity 2
  Record Executor Time and Reimbursable Expenses

Begin using Executor Expenses to record expenses paid using personal funds including:

  • funeral costs, gravesite fees, and honorariums
  • estate maintenance and other miscellaneous items paid
  • expenses such as doctor bills, utilities, property taxes, insurance, trash removal and storage fees
  • travel expenses and mileage incurred while administering the estate
  • office supplies and postage
  • time spent on estate settlement activities (reimbursement varies by state)

Activity 3
Create a File Folder

Create a file folder to store bills, receipts, checks, deposits, and correspondence. Keep accurate and detailed records throughout the process of estate settlement including dates, times, and reasons for actions. File the forms used in Activities 1 and 2 above.

Best Practices

Take special care to pay bills that if left unpaid, could directly impact the value of the estate (e.g. insurance and utilities).  This ensures that assets are protected.
Remember that any heir, relative, or the probate court can legally request accounting of the assets from the time of death to the distribution of property. It is the executor’s responsibility to properly account for costs, changes in assets, and values.

(if this Step is complete)
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