According to the Alabama probate code, an estate administrator serves the same function as a personal representative, which is the legal term used to describe an individual appointed by the court to carry out the terms of a will, or a matter of intestacy. There is no prohibition insofar as a beneficiary being appointed the role of estate administrator, but it is important to note the fiduciary duties that this legal role entails.

Difference Between Executor and Estate Administrator

The difference between an estate executor and an estate administrator is simply by the way in which these roles are appointed. When someone drafts a will, they name someone to act as the executor of the estate. Once the estate goes to probate, the court will appoint someone to act as estate administrator per that state’s intestacy laws. Unless the court deems the named executor unfit for the role of estate administrator, this person is generally one and the same.

That being said, there is no reason why a beneficiary cannot also be the estate executor or estate administrator, at least legally speaking. There are, however, reasons why you may want to choose an objective, third-party to administer your estate.

Let’s say you own a modest home, a car, and a 401(k) account worth $200K. After consulting with an estate planning attorney, you decide that drafting a will and naming your only daughter as the executor of your estate is the right move. You also choose to name your daughter as beneficiary. Since the combined value of your home, vehicle, and retirement account is greater than $25K, your daughter will have to enter the will in Alabama probate court.

In this example, your daughter has what it takes to be both a beneficiary and an estate executor, as well as the estate administrator. This is what the Alabama probate court will expect from your daughter:

  • Carry out your last wishes as outlined in the will
  • Use letters testamentary as needed in order to settle debts, distribute assets, transfer property titles, and manage the estate
  • Provide administrative reports to the probate court judge

As the executor, your daughter will have the right to start the probate court process, but this does not automatically entitle her to act as estate administrator (executrix)—she will have to follow procedure, submit an application to the court, and become officially appointed as the executrix by the courts. As long as the judge determines that your daughter has the means and abilities to serve as the administrator of your estate, she can be executrix, beneficiary, and administrator all at once.

Should a Beneficiary Act as an Estate Administrator?

Not all situations will be as the one we have described above. In some cases, it may be better to designate executors who are not beneficiaries, which is particularly the case with larger and more complex estates. When you have survivors whom you think may bicker over their respective inheritances, an estate planning attorney will probably recommend naming an executor who is not a beneficiary.

Close friends who have long-standing relationships with your family could be good candidates for executors. It is not uncommon to see people choose in-laws, or people with whom they served in the military, as their executors. When executors or personal representatives are not beneficiaries, they are entitled to reasonable compensation that can be paid from the estate, though this will need to be approved in probate court.

Naming an estate planning law firm as executor of your will is also a great idea. In this case, the attorney’s fees can be paid from estate proceeds, and there is a good chance that the probate court will have no objection to the appointment of a law firm to serve as estate executor. Your chosen law firm will know exactly how to navigate the probate process, quickly and seamlessly, keeping time and cost to a minimum, and working hard to get your estate settled, so your family can reap the benefits of your hard-earned assets.

Contact Miller Estate & Elder Law

Miller Estate & Elder Law is here to help will all of your estate planning, probate, estate and trust administration, and elder law needs. If you have been named executor of a loved one’s estate, we urge you to download our free guide, 7 Steps to Handling Your Loved One’s Estate.

If you’re in need of a power of attorney or have other estate planning needs, feel free to contact our office with questions. You can also download a free copy of The Basics of Estate Planning in Alabama, or attend one of our upcoming free workshops.

If you need more guidance, we are happy to help. Contact us using the brief form below.

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