Fiduciary Duties

As Fiduciary, you are required to:

    1. Locate, collect, and maintain all property owned by decedent.
    2. Make sure all real estate, motor vehicles and other valuables are adequately insured.
    3. Have all real estate, as well as household goods and automobiles appraised or otherwise properly valued, for listing in the estate’s inventory and tax preparation.
    4. Obtain the value of all stocks, bonds, mutual funds, annuities, certificates of deposit and bank accounts, as of the date of decedent’s death.
    5. Prepare an itemized inventory of the decedent’s estate assets within 60 days of your appointment by the Court. As your attorney, we will draft the final documents for you once you have provided us with the information.
    6. As Fiduciary, you are required to observe a prudent standard of care in handling the estate assets.
    7. You must establish a checking account, in a bank where you get back your canceled checks, or copies of them, as these will be needed to verify estate expenditures in the event that a beneficiary, the court or a taxing authority questions any payments or distributions. All estate expenses are to be paid by check.  The estate account is to be titled as follows: (Decedent’s name) Estate, (Your name), Personal Representative. The account will be set up under the estate’s federal identification number, not the decedent’s or your social security number.
    8. Keep all of the assets of the decedent’s estate separate from your own. Estate funds should never be co-mingled with your personal funds.  This would be a breach of your fiduciary duty, and a reason for your removal.
    9. You are to determine what legal debts the decedent owed. You should review the decedent’s checkbook and business records.  Consult with our office as to the payments of debts, costs of administration, bond premiums, funeral bills and other debts and obligations of the decedent and/or the estate.  Some debts may by unenforceable.  Some obligations may have legal priority over others.
    10. Do not use estate funds other than for the payment of the decedent’s legal obligations. The unauthorized use of estate funds may result in personal liability on your part.
    11. You are required to file the decedent’s final income tax returns, both federal and state, as well as any income tax returns for prior years if necessary. Our office will arrange for preparation of these income tax returns for you, if you wish, but you need to provide us with the information for their preparation.
    12. Do not self-deal in any manner. Do not buy anything from the estate of the decedent.  Do not borrow any funds from the decedent’s estate.  If you have a personal claim against the estate (one that arose prior to the decedent’s death), let us know immediately as this must be handled with care.  Actions of this nature are grounds for your removal, if not approved by all heirs or the Court.
    13. You are required to file all death-tax returns. This includes the Kentucky Inheritance Tax Return, and, if the estate is large enough, a Federal Estate Tax Return.  All taxes due are to be promptly paid by you as personal representative of the estate.
    14. You are required to file fiduciary income tax returns, that is, tax returns that show the income earned by the estate during administration.
    15. Do not make any distributions to any beneficiary of the estate without first consulting with our office. Partial distributions of estate assets are usually not appropriate until the claim period expires.  Prior to making any such distribution, make sure that you have retained ample funds to pay all the decedent’s and the estate’s legal debts, taxes and costs of administration.  Remember that specific bequests must be satisfied before any residuary bequests.  In Kentucky, specific bequests must be paid within one year after probate of the will or be subject to interest.
    16. If the estate is not finalized within two years, you are required to file a Periodic Final Settlement. If the beneficiaries are not satisfied with any delay, they may petition the Court for Settlement.
    17. It is the duty of the Fiduciary to protect and preserve the estate assets, pay the decedent’s legal debts and taxes, and make distribution of the remaining assets in accordance with Kentucky law or the provisions of the decedent’s last will and testament. The Fiduciary is to faithfully perform all the duties required by law under the Kentucky Revised Statutes governing the administration of estates.
    18. If the decedent’s estate has stock or bond holdings or other investments, you may wish to consult a professional for investment advice, as you will be responsible for the prudent supervision of those investments. In addition, you will be required to determine whether the beneficiaries want to take their respective distributions in kind or in cash.
    19. You are entitled to return the services of accounting and appraisal specials for inventory and tax preparation, real estate agents for the sale of estate property, auctioneers for the sale of real or personal property and other specials as may be prudent in the exercise of your duties.
    20. You are entitled to a reasonable fee for the services that you render as personal representative, unless you waive the fee. But, you must keep an accurate ledger of the time you have expended on the estate in order to be compensated, as well as receipts for your out-of-pocket expenses.  If any beneficiary or the Court objects to your fees, you will need records to be able to justify and defend them. NO FEES ARE TO BE TAKEN BY YOU AS PERSONAL REPRESENTATIVE UNTIL THE ESTATE ADMINISTRATION IS READY TO BE FINALIZED AND YOU HAVE DISCUSSED THOSE WITH OUR OFFICE.
    21. You could be required to prepare a complete written account of your administration and provide each beneficiary, heir, or devisee with a copy of it. This accounting must list all assets and income and its source; all disbursements made, along with a recap of the assets remaining for distribution, and a proposed final distribution.  As your attorney, our office will prepare this report on your behalf, however, you must maintain the appropriate records for its preparation.
    22. Notify our office of any change in your or any beneficiary’s address or telephone number.

    If any questions arise during the administration of the estate as to your responsibilities, particularly how the above responsibilities relate to this estate, we invite you to contact our offices or call (502) 937-5287.