Does your Executor like Carnitas?

By Orlando Gotay

You are a prepared person. When you moved to Mexico, you sat down and made sure that your will (which you wrote out some years ago in the states, when you married) reflected that you had purchased that shiny gem of a villa, where you now hang out and enjoy beautiful sunsets—and maybe even spin Sinatra records while wearing Tonmy Bahama shirts.

You feel good as your papers are in order. Well, on paper, that is.

One of the key decisions made in a will is the designation of the executor (or executrix, if a “she”). This person will be in charge of marshaling your assets, tallying them up, paying your debts, and distributing your remaining assets according to your wishes.

Does that person even know how to get to Mexico? I know, I know…but you may get the point. If you own assets in Mexico that comprise part of your estate, your executor had better be able to, willing, and frankly interested in getting his or her hands wet down here. I believe that a “remote” executor could be a recipe for disaster and could lead to dissipation of assets.

You could say “I can appoint someone local I trust to deal with this”—and that could be part of the solution. But beware: the executor of a US person may acquire responsibilities with regard to the estate with federal (and state) taxing authorities…your executor must know what those are.

Thus, you need to be very sure that if you choose a local person as executor, he or she is familiar with the duties in the US. Similarly if you have a US executor, he or she needs to be prepared to address the issues involved in dealing with property in Mexico.

The expense of several trips by the US executor could put a dent even in larger estates, not to mention delay.

An ounce of prevention is worth a pound of cure. The will you drafted back in your stateside days may not be best suited to meet your current needs.

Orlando Gotay is a California licensed tax attorney (with a Master of Laws in Taxation) admitted to practice before the IRS, the US Tax Court and other taxing agencies. His love of things Mexican has led him to devote part of his practice to the tax matters of US expats in Mexico. He can be reached at tax@orlandogotay.com.

 

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