What terms are involved in the administration of estates?
August 1, 2024 – Matthew S. Akers & Douglas McCarthy
Terms involved in the administration of estates include probate, fiduciary, intestacy, and specific bequest. Probate is the legal process that determines the validity of a will and oversees the administration of estates.
A fiduciary is a person or entity possessing the legal authority and obligation to act in the best interest of another party. In this context, it refers to the individual appointed to manage and distribute the assets of a deceased person’s estate according to the terms of their will or the laws of intestacy.
The fiduciary, also known as an executor or personal representative, has a significant responsibility to carry out the wishes of the deceased while adhering to all relevant laws and regulations, such as inventorying assets, paying debts and taxes, and distributing property to beneficiaries.
Importantly, the fiduciary is held to a high standard of care, loyalty, and honesty. They must avoid conflicts of interest, act impartially, and make decisions solely in the best interests of the estate and its beneficiaries. Failure to fulfill these duties can lead to legal consequences.
Intestacy refers to the situation where a person passes away without a valid will or without specifying how their assets should be distributed upon their death. When an individual dies intestate, state laws govern the distribution of their estate — which may or may not align with their wishes. In this situation, the court appoints an administrator to manage the deceased person’s estate and distribute the assets according to the intestacy laws of Virginia, which dictate the order of inheritance based on familial relationships — with spouses, children, parents, and other relatives considered in a specific order. Distribution of assets seeks to provide for surviving family members and close relatives in a fair and systematic manner. However these proceedings can be complex, especially when there are disputes among potential heirs or uncertainties regarding the deceased person’s assets.
A specific bequest is a clear and direct gift of a particular item or asset stated in the deceased’s will to a specific individual or entity.
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