Articles Posted in Accountings

Fiduciaries in New York such as executors, administrators and trustees are obligated to account to the beneficiaries.  This means that estate and trust beneficiaries can request that they be provided with a financial accounting of the fiduciary’s activities.  An account typically has specific information contained in various schedules showing the assets and income received, the investments made, the expenses and debts that are charged against the assets and the balance of funds or assets remaining on hand.

Depending upon the nature of the trust or estate, the accounting may be simple or complicated and encompass dozens or more pages.  Most often, a beneficiary will receive an informal accounting meaning that the accounting will not be part of a formal accounting proceeding in the Surrogate’s Court.  In this context, the fiduciary and beneficiary can discuss the issues and information presented in the account and reach an accommodation and settlement which approves the account.

In other situations, a formal accounting proceeding may be needed.  These matters involve extensive estate litigation such as discovery in the form of document production and witness testimony.  Objections to the account must be filed by the beneficiary.  These can be based upon breach of fiduciary duty such as misappropriation of assets or other improper acts.

The job of an estate fiduciary is to settle a decedent’s estate.  Whether the fiduciary is an Executor or Administrator there are three main aspects to estate administration.  At the outset, the proceeding to appoint a fiduciary is critical.  This is because until an administrator or executor is appointed, there is no one who has authority to handle the affairs of the decedent.  Thus, estate assets cannot be collected or protected and estate debts and obligations cannot be paid or satisfied.

Each estate is confronted with different issues.  Sometimes a Last Will needs to be probated which may result in estate litigation in the form a Will Contest.  Other estates may be intestate which can involve kinship hearings.

Once a fiduciary is appointed, the next step is to collect the assets of the estate and determine what debts, taxes or other liabilities need to be resolved.  On occasion, there may be lawsuits involving the decedent concerning debts such as mortgages, credit cards or medical expenses.  There can be disputes concerning real estate ownership or business interests.  The New York Probate Lawyer Blog has published many articles relating to estate administration.

The administration of a New York estate typically has three phases.   At the outset, a fiduciary needs to be appointed such as an Executor or an Administrator.  Once there is someone in an official capacity to handle the decedent’s affairs, the process of locating and collecting assets can begin.  Also, estate debts and obligations must be determined and resolved.  Both of the above phases can cause delays in finalizing the estate due to such problems as Will Contests or disputes regarding the ownership of assets.

The final part of the process in handling a decedent’s affairs is the accounting phase.  All fiduciaries, whether an Administrator or Executor or Trustee, must provide an accounting to the estate beneficiaries.   The New York Probate Lawyer Blog contains many articles discussing the various issues involved with administering an estate.

An estate accounting contains many schedules which provide detailed information regarding the amounts received and expended by the fiduciary.  The beneficiaries have an opportunity to review the accounting and file Objections if they feel there has been a breach of fiduciary duty.  The Surrogate’s Court will scrutinize the accounting for accuracy and proper reporting.  Recently in a Bronx estate, the Court found that the Administrator did not include the value of the decedent’s cooperative apartment.  The cased was entitled Estate of Scott and was decided by Bronx Surrogate Neilda Malave-Gonzalez, on August 2, 2019.  In Scott, the Court determined that there was insufficient proof that the decedent’s son was entitled to succeed to the ownership of the apartment and exclude its value from the accounting.

The administration of a New York estate typically is comprised of three stages.  The first stage involves the appointment of an estate fiduciary such as an Administrator when the decedent dies intestate or an Executor when there is a Last Will and Testament.  In most cases this stage is uneventful and after a complete petition and supporting papers are filed with the Court the fiduciary is appointed.  Sometimes, there is estate litigation concerning a contested Will or the appropriate person to be appointed as Administrator.   Kinships may also be an issue.

Stage two of an estate involves the collection of assets and the payment or settlement of claims and estate obligations.   Surrogate’s Court litigation may also be needed here if there are disputed issues regarding estate liabilities and the ownership of assets.  An estate executor or administrator has a fiduciary obligation to collect and protect the estate assets.  Creditor’s claims and tax issues can complicate the finalization of the decedent’s affairs.

In the third and final stage, the estate fiduciary is ready to distribute the net assets to the beneficiaries.  The fiduciary usually prepares an Accounting.  This document contains detailed information as to all of the estate assets and income collected as well as all of the expenses and other items paid from the estate.    The accounting will set forth various unpaid items to be paid such as fiduciary commissions and attorneys or accountant fees.  It may also contain proposals for the manner in which the net estate is to be distributed by providing a final calculation of each beneficiary’s interest.

Estate settlement in New York requires that the fiduciary determine and resolve many difficult types of issues. Among the items Administrators and Executors need to finalize are claims against the estate.

Creditor’s claims can be in various forms. The more commons claims are outstanding credit card bills. Also, the decedent may have left unpaid medical bills or a mortgage. Business debts and unpaid matrimonial obligations from a divorce may also need to paid. The fiduciary has a responsibility to satisfy or discharge all claims. If a creditor is not satisfied, a fiduciary can become personally liable if he distributes estate assets before a resolution. Continue reading

An estate fiduciary can be an Executor, Administrator or Trustee. All fiduciaries have various duties and responsibilities. When a fiduciary fails to fulfill one of these obligations he may be found to have breached his fiduciary duty.

One of the most important duties of a fiduciary is to provide beneficiaries with an accounting of his financial activities. The New York Probate Lawyer Blog has discussed accounting proceedings in many earlier posts. In an accounting, there will be numerous schedules detailing the transactions that were engaged in. For instance, in Schedule A there will be a list of assets that were collected. Another Schedule provides details regarding income received during the time period of the account. Yet another Schedule will provide the items of expenses and payments that were made. Continue reading

The settlement of an estate in New York can be divided into three main categories. The first category or phase is the appointment of the fiduciary. When a decedent has a Last Will, then the Will needs to be filed with the Court and admitted to probate. Probate proceedings in the Surrogate’s Court can be contentious and involve Will Contests.   Once a Will is admitted to probate, an executor is appointed and the terms of the Will control the ultimate estate distributions.

When a decedent does not have a Will, then an Administration proceeding must be filed to have an Administrator appointed for the estate. The estate of a decedent who dies intestate (without a Will) is distributed to the decedent’s distributees (next of kin). The New York Probate Lawyer Blog has posted many articles concerning Probate and Administration proceedings. Continue reading

There have been numerous posts in the New York Probate Lawyer Blog which describe  the basic process to settle an estate.  A brief review of these facts is always helpful:

1.  First it is essential to determine whether the decedent died leaving a Last Will or without a Will (intestate). The existence or non-existence of a Will determines whether the procedure to be followed in Court involves the probate process or intestate administration.

2.  Once the process to be followed is ascertained, an appropriate petition and other papers need to be prepared and filed with the Surrogate’s Court.

3.  After all necessary estate papers have been filed with the Surrogate’s Court and the Court has approved the filing, an Executor or Administrator will be appointed. The fiduciary is granted Letters Testamentary in the case of a probate and Letters of Administration when a decedent dies intestate.

4.  Once appointed, the Executor or Administrator begins the process of estate settlement by collecting the decedent’s assets and paying the decedent’s debts and obligations along with estate administration expenses.

5.  The final stage of the estate is providing a payment of the net estate funds and assets to the beneficiaries. Typically, the fiduciary will prepare an accounting of the assets collected and payments made and provide this accounting statement to the beneficiaries so that they can review the basis for the distribution being made to them. Continue reading

The settlement of a decedent’s estate can be viewed as encompassing three stages. Estate Lawyers in New York City are familiar with this process. The first step involves the appointment of the estate representative. When a decedent leaves a Last Will and Testament the Will is filed with the Court and submitted for probate. Once the Will is admitted to probate, the Court appoints an Executor. In situations where the decedent dies intestate (without a Will), a proceeding for Letters of Administration is presented to the Court and the Court then appoints an estate Administrator.

After a fiduciary is appointed, the second stage of the estate settlement process involves the collection of estate assets and the payment debts, taxes and other obligations. As discussed in earlier posts in the New York Probate Lawyer Blog, both of the above stages can be filled with complex issues such as Will Contests and Surrogate’s Court Litigation regarding the assets and obligations of a decedent. Continue reading

An estate fiduciary such as an Executor and Administrator has many different obligations. The New York Probate Lawyer Blog has discussed many of these duties. For example, the fiduciary must locate, protect and collect estate assets. This function includes such tasks as closing a decedent’s bank accounts or brokerage accounts and depositing the funds into a newly established estate bank account.

Also, the fiduciary must pay a decedent’s debts and obligations. These items may include rent, mortgage payments, utility bills, income taxes and credit card payments. Another source of expenses are those incurred during the course of Estate Administration or Estate Settlement such as estate taxes, brokers fees that may be incurred if a decedent’s real estate needs to be sold and the costs of maintaining and protecting estate assets. Continue reading