There are two types of answers to this question.
The first is the direct answer — executors don’t have to proactively give a detailed accounting record to the beneficiaries unless it is requested. These are a part of a beneficiary’s rights, which we will cover in more detail in just a second.
The second is because executors have to deliver certain things to the probate court including an inventory of assets and track their activity/expenses to reduce their tax burden / protect themselves against any disputes or lawsuits, keeping beneficiaries updated with reports and good accounting is just the best way to go about it.
It keeps executors accountable, should answer any questions beneficiaries have if it’s detailed enough, and makes the process more collaborative.
What is a Beneficiary Entitled to from an Executor?
The executor’s job is to dissolve an estate according to the will, if it exists, or according to the local intestacy law if a will isn’t in the picture. That doesn’t change if they’re also a beneficiary, a family member, a third-party — whatever.
Their fiduciary duty, which includes legal and ethical mandates, is to carry out the distributions of assets fairly and legally. If they don’t do that, then they could be subject to fines, lawsuits, or even criminal charges.
Beneficiaries are those who stand to gain something from a will, a.k.a. an inheritance. And since the executor is, in a way, working for the beneficiaries on behalf of the person who has passed, they have rights to and must be told certain information.
So executors must disclose these things to beneficiaries:
- A complete inventory of all assets of an estate, ideally organized into categories.
- The value of those assets at the time of death
- How the assets are owned and how / how they have been transferred (trusts, non-probate assets, etc.)
- All debts, liabilities, and tax bills/payments made on behalf of the estate.
- Any executor expenses / transactions charged to the estate’s accounts.
These are usually sent in the forms of periodic reports as requested or proactively given by the executor toward the end of probate. If the court is supervising the process, then they will also request some of this information.
"Having this [for probate] is so much better than just googling around"
Beneficiaries typically sign off on what they are being given
Depending on state and/or county law, beneficiaries may need to give formal consent before an estate can be closed. Other situations may require a hearing of sorts, but beneficiaries can often waive that if they don’t think it’s necessary.
It’s normal for an executor to send out an informal list of everything being split and how and asking beneficiaries to sign a receipt of sorts. This basically says, “Hey I saw what I was being given and I’m cool with it.”
If everyone says it looks good and gets their response notarized, the executor can often go ahead and release the assets, making the probate process much shorter.
And then if a beneficiary changes their mind in the future, the executor will refer to that receipt as evidence of a job well done.
But… if beneficiaries aren’t happy with the informal accounting, then that could pave the way for a more court-supervised overview / having lawyers involved.
At that point the accounting gets much more rigorous and any disputes will have to be handled between the relevant parties, their lawyers, and the judge.
A.k.a. It gets more complicated, and you probably need a lawyer.
Some advice for executors and beneficiaries
Whatever you can do, try to work together during this process, regardless of previous grievances or issues. Disputes will only drag this out, and there are so many things that can make this easier:
Online tools that make inventories & accounting simple, good educational resources (wink), a good lawyer…
Try to understand where everyone is coming from, and do your best to put your trust in your executor (if they haven’t given you any reason to doubt it!).
