Is a Beneficiary of a Will Entitled to an Accounting?

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Any beneficiary of an estate is entitled to an accounting from the executor or administrator of the estate. This is true whenever assets  pass through Surrogate’s Court. The individual providing the accounting is the Executor appointed under a Will or the appointed Administrator when someone dies without a will. Of course, if no assets pass through surrogate’s court, then there is nobody to request an accounting from. Non-probate assets are those the decedent held jointly with another or where a beneficiary was named.  Beneficiaries are often named on retirement accounts and life insurance policies. Deeds and joint bank accounts are often held  jointly with a spouse.

What Must Be Disclosed?

At a minimum, the Executor/Administrator must provide beneficiaries with information about all assets, disbursements or payments made to creditors, any commissions due, and whether funds are being held in reserve. Additionally, they must provide a distribution schedule – disclosing what amounts are to be paid out. The Executor/Administrator can do an informal accounting or  provide all estate bank account statements along with a copy of the check registrar showing all deposits and checks written from the estate account.

What if there is No Accounting or the Accounting is insufficient?

If there has been no accounting or a beneficiary is not satisfied with the accounting, the beneficiary can petition in Surrogate’s Court to compel a formal accounting. Once the petition for a compulsory accounting is filed, the court will require the Executor/Administrator to provide an accounting on a form prescribed by the court by a certain date. Once filed, the beneficiary has the chance to request documentation and examine the Executor in a deposition. If there are still uncertainties after the deposition, the beneficiary can file objections. These objections are the beneficiary’s opportunity to detail any grievances with the accounting. After filing objections, the matter proceeds as a contested matter.

If the parties are unable to settle, the Court will issue a decision. In the decision, the Court will determine whether the fiduciary acted properly and how the balance in the Estate will be distributed. If the Court finds that the Executor/Administrator acted improperly, the Court can issue sanctions. Such sanctions may consist of a fine or denial of commissions. If the Executor/Administrator is also a beneficiary, the Court can reduce his or her share to offset any mismanagement of assets.

An Attorney Can Help Navigate Compulsory Accounting

It is best to try and settle the estate informally for a variety of reasons, including time and expense. However, if the estate representative is not forthcoming or provides inadequate records, a compulsory accounting may be necessary. Anyone at a crossroads with an Executor or contemplating a compulsory accounting should consult with an experienced probate attorney. Such contested Surrogate’s Court matters can be complicated and an estate attorney can advise you on the best course of action.

Burner Law Group, P.C.

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