Step Three: Paying Creditors
The third step, is to make pay the valid debts of the estate. The debts will include filing a final tax returns, one for the Decedent and another for the estate. Medi-Cal and Social Security must be notified and any claims paid. These creditor claims must be paid before any distributions are made to the beneficiaries. Remember, if you are acting as the estate Administrator you are a fiduciary and therefore you may be personally liable if a creditor does not receive the amount to which they are entitled.
Step Four: Distribution to Heirs
Finally, the beneficiaries will be paid. It is essential that the terms of the estate plan be followed. When making this distribution you will need to prepare a final accounting and a notice of proposed distribution. Receipts should be prepared and signed by each beneficiary when they receive their share. These receipts are to protect the Administrator from claims from beneficiaries that they did not receive their entire share.
Conclusion
As you can see from this article there are many steps to an Estate Administration. It is essential that each step be taken and completed before moving on to the next one. Further, one should always discuss this process before undertaking it with a competent attorney.
