I’m an Executor, Now What?
Author: Hope Wood
An honor has been bestowed upon you. You have been deemed trustworthy, responsible, and organized. You are the Executor of an estate. As Peter Parker was told by his uncle, “with great power comes great responsibility”. You are ready for the responsibility, but where do you begin?
You will be faced with common issues like creditors, asset transfers, and personal property. Estates can also include taxes and real estate. This article provides a starting point for tackling the role you were not trained to do.
Where do I start?
If the decedent has a valid Last Will and Testament, it should be filed with the clerk of court for the county where the decedent lived. The clerk of court can help you file the Will if you go in person. Whether the administration of the Will requires court supervision (probate) depends on the assets that transfer through the Will.
Who do I notify of a death?
The government. If a funeral home is hired in Iowa, they will notify the federal Social Security Administration and the Iowa Department of Health and Human Services.
Credit reporting bureaus. Give notice to one and they will notify the other two. In the same notice, you can request a credit report so you know what debt exists. Here is a link to report a death to Experian, one of the three credit.
Veteran Affairs if the decedent was a veteran.
If the estate is being administered in the probate court, specific notices must be published in the newspaper and mailed. The attorney hired to represent the executor is responsible for completing the required notices.
If the estate doesn’t need probate, but you want to cut off the creditors, an “Estate without Present Administration” can be completed. Part of this process is the publication in the newspaper and mailing required notices. You will need an attorney to guide you through this process.
Do I pay the mortgage of a deceased person?
In almost all circumstances, the answer is yes. If the mortgage exceeds the market value of the house, it may not make sense to pay the mortgage. This situation tends to occur when there is a reverse mortgage or there is a second mortgage. Sorry to be a broken record, but talk to an attorney before you pay the mortgage.
The largest debt for most estates is a mortgage. A mortgage is a type of loan that has a security interest. A security interest for a mortgage is the promise from the buyer that if the terms of the loan aren’t followed, the lender has a legal right to claim the house. The lender must go through the legal process called a foreclosure before obtaining legal title to the home. Keep the mortgage paid to avoid this process. If the home is sold, then the remaining mortgage is paid before the proceeds are distributed. If the house is transferred, then the transferee must continue to pay the mortgage. The good news about transferring the home to an heir is that they get to keep the interest rate.
Do I pay the creditors a deceased person?
No. An executor is not personally liable for the debts of the deceased person. A debt of the decedent is paid in one of the folllowing ways:
The Will is administered in the probate court, a creditor files a claim in the required time period, and there are assets transferring through the Will that can pay the debt.
The estate is administered in probate court and a creditor makes a demand on a designee of a payable on death (POD) or transfer on death (TOD) account because the assets subject to probate are insufficient. Iowa Code 633D.8.
A vehicle that is secured by a lender that provided the car loan can repossess the vehicle.
Unpaid federal tax, state tax, and property tax can be levied against the real estate owned by the decedent.
If Iowa Estate Recovery has a claim, they can elect to open probate to be paid from the assets of the estate.
How do I transfer money of a deceased person’s account?
The process for transferring assets of an estate depends on how the asset was owned and whether there is a surviving owner or designated beneficiary.
Using an Iowa Small Estate Affidavit.
If the gross estate that would transfer through a Will does not include real estate, or if real estate is transferred to a surviving joint tenant AND the value does not exceed $100,000, then a small estate affidavit can be used. The gross estate that does not transfer through a Will excludes assets that have a surviving beneficiary, joint owner, or named designee. Learn more about a small estate affidavit at $100,000 Small Estate Affidavit in Iowa.
Using a claim form.
If you are the beneficiary named in an asset owned by the deceased person, then you file a claim form with the entity that manages the asset. If there is not a surviving beneficiary and it falls under the small estate affidavit requirement then that option is available. If there is not a surviving beneficiary and probate is required, then the administrator appointed by the court will file a claim form on behalf of the estate.
How do I transfer a vehicle after death?
If the Will is not being administered in the probate court, the person entitled to the car can go to any county treasurer’s office in the State of Iowa. Specific paperwork must be submitted to transfer title. This includes a copy of the death certificate, title of the vehicle, affidavit of death - DOT form 411083, and the application for title form - DOT 411007. If there is not a Will, then the affidavit of death is DOT form 411088. For more information, visit the specific page of the Iowa Department of Transportation.
How do I transfer real estate?
If there is a surviving joint owner of the real estate, then an affidavit of surviving spouse or surviving joint tenant can be used to transfer the real estate. If there is not a surviving joint owner, then probate is needed to transfer real estate. An alternative to probate is to wait five (5) years from the date of death and transfer the real estate using a 9.8 Title Affidavit. The Affidavit can only transfer the real estate to the heirs-at-law even if a Will says otherwise because a Last Will and Testament cannot be probated five (5) years after the date of death.
Do I have to file taxes?
Taxes must be filed for the year of death if the decedent received income that met or exceeded the threshold requirement. For federal taxes, IRS Form 56 must be filed with the 1040 income tax return; it designates a fiduciary for the deceased person. If an income tax return is required to be filed, the tax statements that are mailed in January of the year after death will be used to file the return. February of the year following the year of death is the earliest a personal income tax return can be filed.
How is the personal property distributed?
Specific gifts may be designated in a Last Will and Testament. Those are distributed first. The remaining personal property is distributed based on the terms of the Will. If there is not a Will, then the heirs-at-law of the deceased person have an equal right to the personal property. The heirs-at-law are determined by Iowa law. If there is a surviving spouse and no children, the surviving spouse receives all of the personal property. Iowa Code 633.211. If there is a surviving spouse and children who are not children of the surviving spouse, then the distribution depends on the value of the estate. Iowa Code 633.212. If there is no surviving spouse, then the distribution goes equally to the descendent’s children and if there are no children then under the rules of descent in Iowa Code 633.19.
Hope Wood JD specializes in probate and can be your guide. We have a physical and digital Executor Handbook written specifically for the Executor. We also provide a timeline of all the stages of probate so you will know how long it will take.
Schedule a probate consultation today. In the consultation, you will receive legal advice about the legal options to transfer assets of a decedent. At the end of the consultation, you will receive a flat fee price if you want to hire Hope Wood JD for your legal needs. Even if you don’t hire us, you will leave the consultation with a wealth of knowledge about transferring assets.
Hope Wood, Attorney and Law Firm Owner
I feel incredibly lucky to have helped more than 1,200 Iowans with their estate plan.
I specialize in estate planning, trust administration, and probate so I can be all in on what you need for your legacy.
