What obligations does an executor have regarding estate taxes?

An executor holds significant responsibilities within the estate administration process, and one of the primary obligations is to file estate tax returns and ensure that any taxes owed by the estate are paid. This task is critical because the executor acts as the estate's representative and is responsible for managing the estate's overall financial obligations before distributing assets to beneficiaries.

The executor must assess whether the estate is liable for any taxes based on its value and the assets it contains. Filing the necessary tax returns ensures compliance with tax laws, and paying any outstanding taxes is essential to prevent penalties or interest from accruing. This duty is part of the fiduciary role of the executor, as they must uphold the interests of the estate and its beneficiaries.

In the context of the other options, managing funeral arrangements is only a small component of the executor's duties and does not encompass the full scope of their responsibilities. Immediate distribution of assets is not advisable until all debts and taxes have been settled, and the executor does not typically need to pay estate taxes from their personal funds, as the estate's assets should cover these expenses.