These are tough times. But thoughtful choices can stretch the dollars you get.
What are letters testamentary?
When a person dies and has properly executed a last will and testament that names another person to manage his estate, the court issues letters testamentary. This is a legal document issued by a probate court that allows the personal representative, or executor, to inventory, appraise and distribute the decedent’s assets.
Someone who has personal property, including real estate, bank accounts or personal belongings that he wishes to bequeath to a specific individual will draw up a will. The person who draws up the will is referred to as the “maker” of the will. This legal document typically names a person whom the maker has chosen to handle his estate and distribute the assets in accordance with his will. That person is called the executor of the estate and is responsible for distributing assets, paying bills, filing a final tax return and paying estate taxes.
Letters testamentary are not issued when there is no will. When a person dies intestate, or without a will, the court issues letters of administration and appoints someone to distribute the decedent’s property.
Letters testamentary example
Pat has been designated as the executor of her mother’s estate in a properly executed last will and testament. She has a copy of the will, estimates of her mother’s debts and the value of the estate, and an affidavit stating that she is the named executor. At a hearing, the court rules on the validity of the will, authorizes Pat as executor and issues letters testamentary. Because she has to distribute the assets of the estate, Pat opens a bank account in the name of the estate. She uses the account to collect all the funds belonging to the estate, pay the bills of the estate, and distribute the remaining assets in accordance with the terms of her mother’s will.