When settling an estate, remember to be fair to yourself.
The Executor Adviser is an advice column created by Executor.org for Legacy. Executor.org’s experts aim to help readers with questions about executorship and provide comprehensive, free online resources to guide executors through this complex process.
When settling an estate, you’ll want it to happen smoothly, quickly — and fairly.
But remember, a part of being fair in this process is being fair to you, as executor. When I was an executor, I distinctly remember not wanting the estate to reimburse me for my out-of-pocket expenses as I didn’t want the other beneficiaries to think I was taking advantage of the situation. It was a poor decision on my part. I should have been fair to myself.
The reality is that you will naturally incur expenses as executor, and many of those should be reimbursed by the estate. When possible (and under the supervision of the probate court judge), pay for expenses using estate funds. When you can’t, you should still be reimbursed for essential expenses like:
When you travel to the home of the will writer, as an example, to help maintain the home for sale, that is a reimbursable expense at the government’s mileage reimbursement rate (which is 58 cents per mile in 2019). Tolls are also reimbursable, by the way.
If you buy paint to touch up a wall in the house, the cost of that paint should be covered by the estate, not you personally. Home maintenance falls under the same rules. If you need to pay someone to cut the grass, that is also an expense of the estate.
Mailing costs, copying costs, and other expenses like buying checks for the estate checking account should all be reimbursable by the estate if they were needed to settle the estate.
Anything from attorney fees to the cost of an appraiser is an estate expense and should be paid (directly if at all possible) by the estate.
As a general rule, avoid “non-essential” expenses. Only essential expenses will be reimbursed. The court will determine if an expense is essential. As just one example, buying flowers before an open house at a property you are selling is a nice idea, but not an essential expense, so not technically reimbursable by the estate.
Here are a few other tips you’ll want to keep in mind before you spend money as executor with the expectation of reimbursement:
1. Understand the Estate’s Finances.
Expenses can only be reimbursed if there is money in the estate to reimburse you. Be aware of this, as this is not always the case. If money must be spent on something and you know there’s no money in the estate for it, you can always ask other estate beneficiaries or loved ones to pitch in to help pay for it. But remember, they are under no obligation to do so.
2. Keep Adequate Records and Receipts.
Keep all receipts and track all your expenses. You can track your expenses for free in your Data Vault on Executor.org. This is very important to do as you will likely not be reimbursed without comprehensive records and receipts. No records often means no reimbursement.
3. Follow the Lead of the Court.
Let the judge know what your plans are and follow their advice. Try to avoid any major expenditures without their direction.
4. Communicate with Beneficiaries.
As usual, it’s an excellent idea to talk to beneficiaries before committing to major spending on behalf of the estate. Beneficiaries don’t like surprises, and if one of them has a creative solution to minimize or eliminate an expense, it’s best to hear about it before you spend the money.
5. Know that Expenditures Before Death are Not Reimbursable.
This is an important distinction, as the courts will not allow you to be reimbursed for any costs incurred prior to the passing of the will writer.
If you’d like to learn more about Expense Reimbursement as an Executor and get a free custom plan to help you understand and manage your executor duties, please visit Executor.org. You’ll get a free digital checklist of your required tasks, and have a place to store important information to help you stay organized, The site covers everything you’ll need to know to settle an estate as quickly and easily as possible — and gives you a proven step-by-step approach to managing this complex process.
Have a question about executorship? Get an answer by sending an email to [email protected].
About the Author: Patrick O’Brien is CEO and co-founder of Executor.org, a free, comprehensive online resource that helps executors manage their responsibilities and duties in this complex role. The free tools include a helpful step-by-step interactive guide for executors and invaluable tips on everything from planning a funeral and keeping beneficiaries happy to dealing with grief and managing estate assets.