Choosing non-relative as an estate executor
DEAR JEANNE AND LEONARD: My wife and I, both in our 60s, need new successor executors for our trust. Currently, my successor is my oldest sister, who is now in her 80s. And my wife’s is her mother, who’s older still. We don’t have children, and I am the youngest sibling in my family.
Can you advise on how those in similar circumstances have identified trustworthy third parties to serve as executors? There are no other good candidates within our family to take on this responsibility, but we realize that continuing to assign it to two people in their 80s isn’t sensible. Greg
DEAR GREG: While Methuselah lived to 969, we understand he wasn’t very good with paperwork once he hit 90. So you’re right: You need to find younger people to be your successor trustees.
Now to answer your question: People often name their attorney as executor, or they name a bank. Banks have trust departments designed to perform exactly the services you’re seeking, and the larger mutual fund companies also have gotten into the business. In addition, you might want to interview independent professional fiduciaries. (For candidates, check with the Professional Fiduciary Association.)
Costs vary, so have a sharp pencil ready when you talk to everyone. In addition, be prepared to press them on exactly what services they do, and don’t, provide (e.g., preparing tax returns). And finally, make certain to check their reputations.
One more thing: Since you don’t have a family member who’s appropriate for the job, you should consider whether there’s a close friend who might make a good executor. What you need is someone honest, intelligent and responsible. Whether or not you’re related doesn’t matter.
DEAR JEANNE AND
LEONARD: My wife and I have a friend who cheats on his taxes. Specifically, he has two homes, one in a state with no state income tax, and one in a high-tax state (which is where our home is). Although he lives in the high-tax state most of the year, he pretends his primary residence is in the no-tax state in order to avoid paying our state’s income tax.
Should I turn him in? My wife’s against it, but I’m sick of watching this guy happily consume the services and use the infrastructure that we’re paying for and he’s not. Anonymous DEAR ANONYMOUS: Who wouldn’t be? What this man’s doing is indefensible. But if he really is a friend, you shouldn’t turn him in. That’s not what friends are for. (Murder, yes. Tax evasion, no.)
What you might do, however, is tell him exactly what you’ve told us. Tax evaders like to believe that theirs is a victimless crime, that they’ve simply outsmarted the system. Your conversation might disabuse him of this selfserving rationale — and it definitely will let him know that he has friends who are offended by his cheating and that he’s at risk of being exposed. Who knows? It might even lead him to clean up his act.