Estate Administration: As Executor, Do I Have to File a Formal Account Seeking Court Approval to Close Out the Affairs of the Estate?

A lawyer and old woman discussing Estate Administration

No.  Absent a contested issue and/or disagreement with the beneficiaries, the preferred approach is for the executor and beneficiaries to amicably enter into an informal Family Settlement Agreement.  The executor provides the beneficiaries with an informal accounting regarding the affairs of the estate, including identifying the assets, debts, and expenses of the estate (including attorney fees and executor’s commissions).  This usually includes providing a copy of the Pennsylvania Inheritance Tax Return and the Department of Revenue’s review of the Return.  This also includes a schedule of distribution indicating the share each beneficiary shall receive.

If the beneficiaries are satisfied with the informal accounting and generally how the affairs of the estate were conducted by the executor, the beneficiaries execute the Family Settlement Agreement and receive their respective beneficiary shares.  The executor also signs the agreement.   As part of the agreement, the executor and beneficiaries recognize that the affairs of the estate are concluded and each waives any and all claims anyone may have had related to the estate.  Beneficiaries do not receive their respective shares until all of the parties have signed the agreement.

If a beneficiary refuses to sign the agreement, the executor proceeds to file a formal accounting and Petition for Adjudication in the Orphans’ Court Division of the Court of Common Pleas (not with the Register of Wills).  This formal account and petition must comply with strict rules and standards.  This method is much more expensive and time-consuming.   The executor provides the beneficiaries copies of the account and petition for adjudication.  If any beneficiary has an objection to the account, that objection must be filed no later than at the time of the Court Audit.  Following the Audit, the Court will typically schedule a conference to be attended by the attorneys for each party; then, if necessary, schedule a hearing on the merits of the objections to the account.