This memo will outline for you some of your significant duties and responsibilities as Personal Representative. The term “Personal Representative” is the generic term for “executors” or “administrators” and throughout this letter we will be using the abbreviated term “Representative.”
Generally, the Representative’s duties consist of collecting the assets of the estate, ascertaining and paying debts and taxes, and distributing the remaining assets to those persons entitled to receive them. However, these very general duties are made up of a number of specific responsibilities.
1. INFORMATION TO HEIRS AND DEVISEES.
Within 30 days of appointment, notice of the appointment as personal representative and probate of will must be sent to all heirs and devisees. The notice is given on Form 305PC and a proof of delivery (Form 120PC) must be mailed to the probate court. Our office normally mails these forms for the personal representative.
2. INVENTORY AND APPRAISEMENT.
Within 90 days of appointment as Representative by the Probate Court, the Representative must file an Inventory and Appraisal (350PC) describing and placing a value on all of the assets of the estate and the amount of all indebtedness secured by liens on such estate assets.
It is the Representative’s responsibility to search out and locate estate assets. Some useful techniques include reviewing tax returns for several years prior to the decedent’s death, reviewing bank statements, reviewing fire and casualty insurance policies, checking with banks, stock brokers, employers, with trade associations, professional associations and other organizations for death benefits, for veterans benefits if the decedent was a veteran, and other similar inquiries. All such assets should be included in the Inventory and Appraisement. We will be glad to assist you in the search if you wish. We are familiar with a number of techniques to search for assets belonging to a Decedent.
3. JOINTLY HELD PROPERTY.
Jointly held property, where there is a right of survivorship, and joint bank accounts are usually not a part of the probate estate and except for certain duties to report them to the tax authorities (and perhaps pay an estate tax on such assets) the personal representative is not responsible for such assets, since the ownership of such assets passes at death to the surviving joint owner. However, jointly held property, as well as life insurance, must be listed on the Inventory and Appraisement Form for the Estate.
Shortly after the will is probated (if there is a will) and the Representative appointed, the Representative must advertise for creditors. In Richland County, the Probate Court handles the advertising. The notice will appear once a week for three consecutive weeks. Creditors are directed to file their claims within an eight month period, beginning with the first publication of the creditors notice in the newspaper. All claims arising before the Decedent’s death must be presented within the earlier of the following dates, or they are forever barred: one year of the Decedent’s death, or the later of eight months from the first published notice to creditors to present their claims.
In addition to publication in the paper, we recommend that you contact known creditors. There is a probate form which is appropriate for this notification. Our office can advise you in regard to the appropriate procedure for notification of creditors. It is important that the Representative make a diligent search for claims and notify creditors personally of the claim filing deadline. Any claims or bills which you receive should be promptly sent to us for review.
We will advise you and recommend appropriate dispositions of such items. Not all claims are valid and those that are not valid should be denied by the Representative.
If the decedent owed any money or property to family members or to beneficiaries, a claim from such person should be prepared and filed within the period described above. Otherwise, if the claim is paid even though not timely filed, adverse tax consequences may be incurred by the estate. We would urge that you consult with us before any payment is made from estate funds.
5. REAL ESTATE.
If the real estate is to be distributed to the heirs, the Representative also has a duty to file Deeds of Distribution for any real property which the decedent may have owned in South Carolina. We can assist in this function by preparing and filing for you the necessary “Deeds of Distribution.” The Deed of Distribution, when recorded, evidences on the public record who received the real property from the estate and releases the Representative’s rights to and powers over such property following the conclusion of estate administration.
6. TAX RESPONSIBILITIES.
The Representative is also responsible for filing a number of federal and South Carolina tax returns of various kinds:
Decedent’s Final Income Tax Return. The Representative is also responsible for the final state and federal income tax returns of the decedent, not only for the year in which the decedent died, but also for all previous years, if any, for which returns were or will be due but have not been filed. Thus the Representative must determine if sufficient income was received by the decedent during the year of death and for previous years in order to determine whether income tax returns are due. The threshold amount of income which must be received for state and federal purposes in order to require the filing of income tax returns changes from time to time. If you can advise us of the amount of income received during any year for which no state or federal income tax return was filed, we will be glad to advise you whether it is necessary to file such returns.
Fiduciary Income Tax Return. If the estate receives more than $600 of income during any year, federal and South Carolina a “fiduciary” income tax return must be filed for the estate. We will be glad to consult with you from time to time concerning estate income and, if returns are required to prepare them for you.
7. CLOSING COURT DOCUMENTS.
Once the Inventory and Appraisement Form has been filed, the documents to close the estate can be filed with the court. They include the Petition for Settlement, Waiver of Hearing to Close Estate, and a Receipt.