Definition: An administrator may be a relative, estate planner, accountant, or other professional trained to handle finances for bodies that have no other formal system for doing so. An administrator is typically appointed by just one or more parties deemed ‘deceivers’ in the probate process. However, other individuals or organizations may need administrative assistance during the period between death and distribution of estate assets or even after distribution has taken place.
Examples of Administrator in a Sentence
- The college administrator was unable to keep order.
- Administrators are usually the highest-ranked employee of an organization.
- The director is expected to bring on some new administrators.
The first known use of Administrator
The earliest documented use of the word “administrator” was in 1531. Administrator is a Spanish-derived word that has been borrowed into a large number of other languages.
Who Is an Administrator?
An administrator is one person who has final authority for handling the financial affairs of a deceased person; generally, once a settlement has been reached on all accounts involved in the estate.
Administration includes all duties and responsibilities directly related to handling financial affairs, such as conducting estate planning services, paying debts, acquiring life insurance, maintaining client accounts, and making funeral arrangements.
When a person dies without a will, the court names an administrator to oversee the probate process. The executor doesn’t have any legal obligation to perform their duties. An executor is a close friend, relative, or associate of a decedent who is legally responsible for settling their estate. A person can be appointed executor in a person’s will or appointed through the court if the decedent has not left behind any instructions for their finances and possessions to be managed.
A decedent’s estate administrator is normally chosen based on different criteria, depending on the state. The Administrator of a decedent’s estate is selected based on the laws and regulations in each state and county, depending on the number of assets and beneficiaries. Corporations and individuals who have previously been convicted of a crime and those under 18 are not considered suitable candidates for administrator positions.
Once the will is admitted to probate, the court will appoint an administrator for the estate. Letters Testamentary appoint the Administrator as the authority over financial matters.
Administrators are compensated for their work based on the quality of the results they produce. They must submit detailed timesheets and expense reports to get paid. It’s best to hire a professional legal administrator if you need special assisstance. Such professionals generally charge a fixed fee for their services, depending on the estate’s value in question.
An Administrator’s Duties
One of the first things that an Administrator must do is use their fiduciary authority to obtain every document that would have otherwise become the state’s property if not preserved.
It’s important to know that the documents of the previous individual are not considered private information. All persons appointed as Administrators of an estate can freely provide access to all documents. Before revealing any personal information, make sure you seek legal counsel to understand your rights and duties as an Administrator.
The Administrator closes down the decedent’s business and liquidates its assets, pays off all the business’s liabilities, and takes legal title to the decedent’s real estate, art collections, and other valuable items. The Administrator must hire an independent valuation service to ascertain fair market prices for the decedent’s affairs before selling any of them.
The Administrator is responsible for settling all outstanding tax obligations (federal, state, and local). They should check the decedent’s records to ensure taxes are settled in full. They are also responsible for clearing out any outstanding liabilities with other parties. This is done to avoid responsibility for any unpaid debts.
When all debts, expenses, and taxes are cleared, the remaining money is doled out to the people listed in the will. If there was no will left behind, the property is distributed according to state law. The time required to complete this process depends on the deceased’s estate’s complexity, but probate proceedings typically take two to three years.
Example of an Administrator
Ram died without leaving a will, and he had a surviving son Shyam. When he heard about Ram’s death, Shyam contacted the court to be appointed as his Administrator.
Once the court approved his application, Shyam inquired with Ram’s bank and enquired about his previous tax filings. Shyam realized that Ram did not have enough money in his account. He requested the court to sell the property that he had and settle tax liabilities, and pay off the remaining creditors. The court also compensated him for his work.