Estate and Elder Law

Executors Held Personally Liable for Unpaid Taxes


In a recent federal District Court case, the co-executors of a decedent's estate were held to be personally liable for the decedents unpaid income taxes under the federal priority statute because they distributed assets of the estate, the distribution rendered the estate insolvent, and it took place after they had actual knowledge of the decedent's liability for unpaid taxes. U.S. v. David A. Tyler and Louis J. Ruch, (DC PA 03/13/2012) 109 AFTR 2d ¶2012-583 [enhanced version available to subscribers].

This case should serve as a reminder that serving as executor is not a job to be taken lightly, and that one must take great care to follow the law ensure that one does not become personally liable to acts or omissions as executor.  In my admittedly biased opinion, lay executors should always hire counsel to assist them - and follow counsel's advice.  In doing so, they will often save the estate and themselves money in the long run, not to mention increased peace of mind.

Gregory Herman-Giddens, JD, LLM, TEP, CFP, Attorney at Law (NC, FL, TN), Board Certified Specialist in Estate Planning and Probate Law (NC). North Carolina Registered Guardian, Solicitor, England and Wales. Follow his blog, North Carolina Estate Planning Blog..

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