The Truth About Personal Representatives in Utah

The following information reflects Utah law. It has been provided for informational purposes only, and is not intended to render legal advice. It is not intended to apply to any specific situation. Legal principles discussed can differ in individual situations. Before applying any of this information to your personal use, you should consult with your lawyer.

DEFINITIONS

Decedent: A deceased person–the person who made the Will.

Estate: All property of a decedent subject to probate. In a tax sense, all items of value owned by decedent at death, whether or not subject to probate.

Intestacy: Pattern of asset distribution when there is no Will.

Letters Testamentary: The document issued by the clerk of the court to evidence the appointment and authority of the personal representative named in decedent’s Will. Where there is no Will, this document is called “Letters of Administration.”

Personal Representative: Modern term for the person named in a decedent’s Will to carry out the instructions in the Will. Historically known as an “executor” (male) or an “executrix” (female).

Probate: The legal process by which a decedent’s Will is validated and transfer of title to decedent’s assets is approved.

Settle: Refers to “settling” or administering a decedent’s estate. It means to take control of a decedent’s assets, pay the decedent’s debts and taxes and distribute the remaining assets to those entitled under the Will or the law.

Will: A written declaration of an individual’s wishes for the disposition of property after death.

QUESTIONS AND ANSWERS

Q: What is a personal representative?

A personal representative is the person named in a decedent’s Will to carry out the instructions in the Will and to administer (“settle”) the decedent’s estate. Historically, this position was known as an “executor” (if a male) or an “executrix” (if a female). If there is no Will, the personal representative is the person appointed by the probate court to settle the decedent’s estate.

The personal representative is a fiduciary, meaning that he or she is held to a strict standard of care and propriety in settling the estate. Therefore, there are limitations on what a personal representative can and cannot do.

Q: How is a personal representative appointed?

A personal representative is appointed by the probate court based on the choices listed in the decedent’s Will. The appointment occurs after an application or petition for appointment is filed with the court, notice is given to family members and the court issues “Letters Testamentary” or “Letters of Administration.” A person appointed as a personal representative must accept the position in writing.

Q: What are the duties of a personal representative?

In general terms, the personal representative identifies and collects the decedent’s assets, pays the decedent’s debts, prepares and files income tax returns and estate tax returns (if required), pays estate taxes (if any) and distributes the remaining assets of the decedent to the persons designated in the decedent’s Will or to those entitled by law. This is just a summary of those duties. In addition, there are numerous duties and activities that a personal representative must carry out. Please see listing under “What actions should the personal representative take?”

Even before being appointed, a personal representative may need to:

  • Locate the decedent’s original Will.
  • Confer with the lawyer who will serve as the estate lawyer and arrange for probate of the Will.
  • Confer with family members to determine immediate needs.
  • Apply for court authority to act as personal representative.

Q: Who can serve as a personal representative?

Any adult who is legally competent not suffering from mental or legal disability. Husbands, wives, adult children, brothers, sisters, friends and lawyers can be named as personal representative. It is possible for two or more persons to be named together as personal representative to serve jointly.

Q: Does a personal representative get paid?

Yes, if payment is requested. Serving as a personal representative is like having a part-time job for several months. As such, personal representatives are entitled to payment for services rendered in administering the decedent’s estate. Such fees must be requested by the personal representative and approved by the probate court. Such fees are typically based on the time expended by the personal representative in administering the estate. A personal representative may waive part or all of the fees to which he or she is entitled.

There is no requirement that a personal representative take compensation if he or she does not request it.

Q: How does a personal representative work with the estate lawyer?

The estate lawyer works for the personal representative in settling the estate. Thus, the estate lawyer will handle as many (or as few) details of estate administration as the personal representative requests. Yet it is the personal representative who must decide all issues and sign important papers. Typically, the estate lawyer prepares all court documents, including the official list of assets (inventory), prepares estate tax returns, deals with the IRS and state taxing authorities, and advises the personal representative on estate issues. In some cases, the personal representative may ask the estate lawyer to handle all details of estate administration.

Q: Must the personal representative pay the costs of estate administration?

Yes, but out of estate assets. The personal representative is not expected to use his or her own funds to pay the costs of estate administration. Properly documented out-of-pocket costs paid by the personal representative can be reimbursed from estate assets.

Q: Are there liabilities from being a personal representative?

There could be. For example, if a personal representative distributes estate assets to family members before the decedent’s debts and estate taxes are paid, the personal representative could become personally liable for such debts and taxes. Also, the personal representative would be liable for using estate assets to pay his or her own personal debts. Neglect in performing the duties of the position could also result in liability for the personal representative.

Q: What powers does a personal representative have?

Powers of a personal representative are prescribed by state law, although additional
powers could be included in the decedent’s Will. Generally speaking, a personal
representative has all powers necessary to administer the estate, including the power to sell assets.

Q: What actions should the personal representative take?

Once Letters Testamentary have been issued by the probate court, the personal representative should consult with an estate lawyer and must begin to take action, which may include:

  • Notify known creditors of decedent’s death.
  • Inspect decedent’s residence and other tangible property.
  • Publish “Notice to Creditors” in local newspaper.
  • Obtain Taxpayer Identification Number (TIN) for estate, if necessary.
  • Notify IRS of appointment as personal representative (Form 56).
  • Provide payers of interest and dividends the name(s) and TIN of the new owner(s).
  • Secure decedent’s residence (change locks, winterize, hire caretaker).
  • Seek out and list all of decedent’s assets.
  • Cancel decedent’s credit cards.
  • Establish separate bank account for estate and carefully track receipt expenditures of the estate.
  • Open and inventory contents of decedent’s safe deposit box.
  • Take custody and control of decedent’s assets.
  • Safeguard decedent’s assets; place appropriate items in safe deposit box and verify adequate theft and fire insurance.
  • Collect sums owed to the decedent.
  • Notify life insurance companies and Social Security Administration of decedent’s death and file claims for death benefits.
  • Prepare and file claims for pension, profit sharing and 401(k) benefits, and veterans benefit.
  • Pay valid debts of decedent.
  • Determine extent of homestead allowance, family allowance and exempt property.
  • Determine whether estate tax returns should be filed and, if so, prepare and file such returns and pay estate tax due.
  • Analyze cash needs for payment of family allowances, decedent’s debts and estate taxes.
  • Determine how estate taxes should be apportioned or charged against assets distributable from the estate.
  • Deal with IRS and state tax authorities to obtain estate tax clearances and, if necessary, represent estate in all disputes (administrative and court) with tax authorities.
  • Sell assets as needed for payment of estate expenses, estate taxes or distributions to beneficiaries and heirs.
  • Manage assets of the decedent’s estate, which may include overseeing a family business or family farm, setting policies for decedent’s investment portfolio, collecting rents and lease payments, etc.
  • Confer with family members or other heirs and report to them on administration of the estate.
  • Prepare and submit detailed accounting to estate beneficiaries or heirs or as required by the probate court.
  • Prepare and file personal income tax returns for the decedent for the year of death and pay income tax due.
  • Prepare and file income tax returns for the estate during the period of estate administration and pay income tax due.
  • Make all choices available under the tax laws for both income tax and estate tax purposes.
  • Coordinate with estate lawyer for carrying out any of the actions required of the personal representative.
  • Determine proper distribution of the remaining estate assets.
  • Distribute remaining estate assets to designated beneficiaries or heirs, in proper shares.