Executors Can Recover Property Costs, Life Tenants Pay 100% of Upkeep

An executor who personally funded property taxes, maintenance, and repairs during probate can recover those costs from the estate, while a life tenant occupying one of the properties is generally liable for 100% of its upkeep, according to guidance published in MarketWatch's Moneyist column on Sept. 1.

The advice addressed a reader appointed executor after an older brother failed to probate their parents' will and later died intestate. The estate had cleared probate except for distribution of the properties. The executor's twin brother held a lifetime right to live in one house, while several nieces and nephews — children of deceased siblings — expected their share of the estate without contributing to property taxes, lawn care, repairs, maintenance, or insurance.

Executors are entitled to just and reasonable compensation, typically 1 percent to 3 percent of the estate depending on state law and will instructions. Probate typically runs four to 12 months, though this estate has taken longer given the original executor's death. If the estate lacks sufficient cash to cover property taxes or other expenses during probate, the executor can petition the court for permission to sell the property before distribution to avoid further debt, penalties, or liens.

The stakes are material: an executor who fails to document expenses or properly administer the estate can be sued by other beneficiaries. Conversely, an executor who continues funding properties out of pocket without reimbursement is effectively subsidizing the inheritance of relatives who contribute nothing.

Reimbursement Rights and the 1-3% Executor Fee

Until properties are officially distributed — when ownership transfers to beneficiaries — any expenses should be reimbursed by the estate, including maintenance, lawn care, and property taxes. Executors should keep receipts and document everything, as they are fiduciaries legally responsible for ensuring the estate is administered correctly.

Once distribution occurs, the rules change. If the twin brother is already occupying one of the properties, he should be liable for routine costs like utilities, repairs, and upkeep. Property taxes are generally the purview of the estate itself.

Life Tenants Bear 100% of Property Costs

A life estate gives the twin brother the right to live in the parents' former home for the rest of his life, but this arrangement comes with caveats. He would normally have to pay 100 percent of the costs — property taxes and upkeep — for that privilege. If the life tenant fails to pay local property taxes, the city or county can place a tax lien on the home. In a worst-case scenario, the property could be auctioned in a tax-foreclosure sale to recover back taxes, invalidating the life estate.

For example, if a property sold for $400,000 and the tax debt was $10,000, the remaining $390,000 would typically be distributed to the life tenant and any remaining beneficiaries. Per a Supreme Court ruling, the government may not keep excess funds after a tax debt is paid off.

If these costs are not paid when the beneficiaries take ownership, the executor can file a partition action to sell the property. This legal remedy allows a co-owner to force the sale of jointly held property when other owners refuse to cooperate on expenses. Partition actions are particularly relevant when multiple beneficiaries hold undivided interests in real estate and cannot agree on how to manage or fund the property.

The broader lesson for anyone serving as executor: the role carries fiduciary duties but does not require personal financial sacrifice. Estate funds should cover legitimate expenses, life tenants must bear the costs of their occupancy, and courts provide remedies when beneficiaries refuse to contribute. Probate and estate laws vary by state, so executors should consult local rules and legal counsel before taking action.

This article is for informational purposes only and does not constitute professional advice. Estate and probate laws vary by state, and readers should verify current rules with the latest official sources or consult a qualified attorney.