Disclaimer: I am not a lawyer and this is not legal advice. This article explains general Illinois probate accounting practices to help you understand what documents and statements courts and interested parties commonly expect. For binding guidance about your situation, consult a licensed Illinois probate attorney.
Detailed Answer
Overview — who must account and why
In Illinois, a personal representative (executor or administrator) who manages a decedent’s probate estate generally must keep clear financial records and present an accounting when the court requires it. Courts routinely require a final accounting before approving distributions and closing the estate. In some cases (or by court order or will provision), the representative may need to file periodic or annual accountings. Guardians and conservators who manage another person’s assets routinely file annual accountings as part of ongoing supervision.
Statutory authority
Key Illinois Probate Act provisions addressing accountings and the duties of fiduciaries are found in the Illinois Probate Act (commonly cited as 755 ILCS 5). See the Probate Act at the Illinois General Assembly website: 755 ILCS 5 (Probate Act of 1975). For courts’ practical filing forms and local procedures, see the Illinois Courts forms and self-help resources: illinoiscourts.gov/Forms.
Typical required statements and documents for an accounting
A proper annual or final probate accounting typically includes the following core components. The final accounting will be more comprehensive; an annual accounting covers the reporting period and many of the same categories on a narrower time frame.
- Verified accounting statement (written and sworn): A chronological, itemized statement of all receipts, disbursements, and transactions during the accounting period. This is usually signed and sworn by the personal representative or fiduciary.
- Initial inventory and schedule of assets: An inventory of estate assets as of the date of death (or as of the last accounting date for annual reports), with fair market valuations. For final accountings, the inventory should show the starting asset list and any valuations used for sale or distribution.
- Receipts and income records: Bank statements; brokerage statements; income receipts (dividends, interest, rents, business income); sale proceeds and closing statements (for real estate sales); and any checks or deposits received by the estate.
- Disbursement records and supporting invoices: Cancelled checks, paid bills, receipts for funeral expenses, medical bills, estate administration expenses, insurance premiums, property maintenance, taxes, and contractor invoices. Show payments of valid creditor claims and any creditor claim rejections or court rulings.
- Appraisals and valuations: Formal appraisals for real property, antiques, jewelry, closely held business interests, or any non-cash assets distributed or sold. Appraisals protect against later challenges to valuation.
- Tax returns and tax-related documents: Final individual income tax returns and estate tax returns (if applicable), any IRS or Illinois Department of Revenue filings, and proof of tax payments. Estate and fiduciary income tax information affects administration and distributions.
- Ledger or accounting schedule: A clear ledger showing opening balances, itemized receipts and disbursements (with dates), running balances, fees paid (attorney and personal representative commissions, if requested), and the closing balance to be distributed.
- Proposed distribution schedule: For final accountings, a plan that lists beneficiaries, the specific assets or cash amounts proposed for distribution, and any proposed liens or encumbrances to be satisfied before distribution.
- Proof of notice and service: Documents showing that the accounting and proposed distribution were served on all interested parties (heirs, beneficiaries, and known creditors) and any publication notices the court required.
- Court forms and orders: Any previously entered court orders affecting administration (for example, orders allowing advances, approving sales, or awarding allowances) and the statutory forms required by the local probate court.
Differences between annual and final accountings
Annual accounting (when required): focuses on transactions during the reporting year. It is typically a shorter report showing receipts, disbursements, assets on hand, and any changes in asset valuations. Courts may require annual accounts for guardians, conservators, or when an interested party requests an accounting.
Final accounting: is comprehensive. It must reconcile the estate from date of death through final administration, showing how each asset was collected or disposed of, how creditor claims were handled, taxes paid, expenses and fees deducted, and exactly how distributions should be made. Final accountings almost always require more and stronger supporting documentation (appraisals, closing statements, tax filings, cancelled checks) because the court will close the estate and discharge the fiduciary once it approves the final accounting and distribution.
Timing and procedure highlights
- Courts commonly require that the account be filed with the probate clerk and served on all interested persons before a hearing on allowance. Check local rules for required lead time for service.
- If interested parties object to an accounting, the court will set a hearing and may require additional documentation or an amended account.
- Guardians and conservators generally file annual accounts as part of continued court supervision; personal representatives usually file a final account unless the court waives it or accepts a short form settlement where permitted.
Why thorough documentation matters
Well-documented accountings reduce disputes, minimize the chance the court will require supplemental documents, and protect the fiduciary from personal liability for improper distributions. Documentation is especially important for non-cash distributions, family transfers, sales of assets, and payment or rejection of creditor claims.
Helpful Hints
- Keep a contemporaneous ledger from the start of administration. Record every receipt and expense with date and source.
- Collect original bank and brokerage statements for the entire administration period; scanned copies are acceptable in many courts but keep originals available.
- Obtain written appraisals for real property and high-value personal property before selling or distributing those assets.
- Keep cancelled checks, paid invoices, and closing statements to prove payments and distributions.
- Serve accountings and notices on beneficiaries and heirs on time and keep proof of service (certified mail receipts or an affidavit of service). Local rules set timing requirements.
- Include tax filings and receipts showing payment of estate or income taxes; unresolved tax liabilities can block final distribution.
- If you expect objections, consider preparing a more detailed accounting and an index of supporting documents to speed review at the hearing.
- When in doubt, ask the probate clerk about local forms and filing procedures. Many counties have specific account forms or local rules that control presentation.
- For complex estates (business interests, foreign assets, multiple real properties), consider consulting a probate attorney and a qualified appraiser or accountant early in the administration.
For the statutory framework and more details, see the Illinois Probate Act: 755 ILCS 5 (Probate Act). For court filing forms and local procedural guidance, see: illinoiscourts.gov/Forms.