An Executor or Administrator of a decedent’s estate and the Trustee of a trust are all “Fiduciaries.” A Fiduciary is a term meaning that the person acting as the Executor, Administrator or Trustee has a duty of good faith and loyalty to the estate/trust and to the beneficiaries of such estate/trust. Every Fiduciary has a duty to account, that is, to detail in writing every asset taken control of by the Fiduciary, to report every sale of any asset by the Fiduciary, to report all income collected by the Fiduciary, to report all expenses and claims paid by the Fiduciary, to report taxes paid and to report and account as to every other matter relating to the management of such estate/trust. A Fiduciary can only be discharged from his/her duties as a Fiduciary upon the preparation and delivery to every beneficiary of the estate/trust of an accounting which must be approved either by all the beneficiaries or by a court.
Failure to properly account can subject a Fiduciary to a penalty, known as a “surcharge.”
The obligation to account should not be taken lightly. An accounting must be prepared in accordance with rather complex statutory forms.
If you are the Fiduciary of an estate/trust and need help preparing an accounting, please feel free to contact our office and set up a free consultation today.