Here are the types of expenses you should be tracking:
1. Administrative Expenses
Filing Fees: Fees paid to the probate court for filing documents and initiating probate.
Certified Copies: Costs for obtaining certified copies of the death certificate, Letters Testamentary, and other legal documents.
Postage and Delivery: Expenses for mailing documents and sending packages related to estate administration.
Office Supplies: Costs for paper, envelopes, printer ink, and other office supplies used for estate tasks.
2. Legal and Professional Fees
Attorney Fees: Payments made to the estate attorney for legal advice, drafting documents, and representing the estate in court.
Accountant Fees: Fees for tax preparation, financial advice, and accounting services.
Appraisal Fees: Costs for professional appraisals of real estate, personal property, or business interests.
Real Estate Agent Fees: Commissions and fees paid to real estate agents for selling property.
3. Property Management Expenses
Maintenance and Repairs: Costs for maintaining, repairing, and improving real estate properties, including landscaping, cleaning, and minor repairs.
Utilities: Payments for electricity, water, gas, and other utilities for properties owned by the estate.
Insurance: Premiums for homeowners, liability, or other insurance policies to protect estate assets.
Property Taxes: Payments for property taxes owed on real estate owned by the estate.
Security: Expenses for securing properties, such as changing locks, installing security systems, or hiring security services.
4. Debt Payments
Outstanding Debts: Payments for the deceased’s outstanding debts, including credit card bills, personal loans, and medical bills.
Mortgage Payments: Payments for any mortgages on real estate owned by the estate.
5. Funeral and Burial Expenses
Funeral Costs: Payments for funeral services, including the funeral home, casket, transportation, and other related expenses.
Burial or Cremation: Costs for burial plots, headstones, cremation services, and other related expenses.
6. Taxes and Filing Fees
Income Taxes: Payments for any income taxes owed by the deceased or the estate.
Estate Taxes: Payments for federal or state estate taxes, if applicable.
Tax Preparation Fees: Costs for preparing and filing tax returns for the deceased and the estate.
7. Executor Expenses
Travel Costs: Reimbursement for travel expenses incurred while performing estate-related duties, such as visiting properties or meeting with professionals.
Communication Costs: Expenses for phone calls, internet, and other communication-related costs necessary for estate administration.
Other Executor Costs: Any other reasonable expenses directly related to fulfilling executor duties.
8. Miscellaneous Expenses
Storage Fees: Costs for storing personal property or other assets until they can be distributed or sold.
Inventory and Valuation: Expenses for creating an inventory of estate assets and their valuation.
Estate Sale Costs: Expenses related to organizing and conducting an estate sale to liquidate personal property.
Best Practices for Tracking Expenses
Keep Detailed Records: Maintain a detailed log of all expenses, including the date, amount, purpose, and payee for each expense. This is all tracked in Legacy Logix.
Retain Receipts and Invoices: Keep all receipts, invoices, and other documentation supporting each expense.
Use a Separate Bank Account: Use an estate-specific bank account for all financial transactions to ensure clear separation from personal finances.
Regular Reporting: Expense reports are available to all Legacy Logix stakeholders.
Consult with Professionals: Work with the estate attorney and accountant to ensure all expenses are properly documented and reported.
By tracking these expenses accurately and maintaining detailed records, you can ensure transparency and accountability in the estate administration process, thereby fulfilling your fiduciary duty as executor.