Checks payable to a deceased individual can't be deposited into a personal account, even if you're the beneficiary or spouse. You can contact the check issuer and request the check be issued to you instead. However, this isn't always an option. If you want to deposit the check, there's a legal process you'll need to follow. An estate account typically is required.
Consider also: How to Cash a Check With No Money Trail
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Joint Bank Account Rules on Death
You might wonder who owns the money in a joint bank account when one dies. Know that if you and the decedent had a joint bank account together that carried rights of survivorship, the account and its funds will belong to you.
However, you won't be able to deposit a check payable to the deceased into your account, because his name is removed when he dies. Even if the check is payable to the estate of the deceased, you'll need to open an estate account rather than deposit the check into an account you held together.
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Estate Account Basics
An estate account is set up specifically for collecting assets and settling debts. The account can be either a checking or a savings account. You can visit any bank to open the estate account, but it may be helpful to stick with the decedent's current bank since the information is already on file.
You must be named the executor in the will or have a letter from probate court granting you the authority to open the estate account. Family members are unable to open estate accounts without legal permission. As the executor, you'll be able to make deposits and withdrawals as needed.
So, how long does money have to stay in an estate account? It depends on how long it takes for all the asset transactions to settle. This can mean several months or even a few years.
Becoming Executor or Administrator
If you're named the executor in the will, you are responsible for opening the estate account. Unfortunately, it's not as simple as presenting a copy of the will to the bank. You'll need to be appointed as the executor by filing an Affidavit of Notice with the clerk's office of the county where the decedent lived.
Although the formal probate may not be necessary if the estate is worth less than $50,000, you'll still need to be appointed the executor before you can open the account. If the person dies without a will, known as dying intestate, you'll need to file a petition with the court asking to be appointed administrator.
Although the titles are different, the roles and duties are the same. The executor or administrator must determine if probate is necessary, settle debts, distribute assets and pay the estate's taxes.
Consider also: What Does Being Appointed Administrator Over an Estate Mean?
Opening an Estate Account
You'll need a tax payer identification number for the estate to open the account. Once you're appointed executor or administrator, you can apply for the tax payer ID number online through the IRS website, IRS.gov. Complete IRS Form SS-4, Application for Employer Identification Number. Although the decedent isn't an employee, the number is still required by the IRS for tax purposes.
Bring the checks you want to deposit, the tax payer ID number, copy of the death certificate and paperwork showing you're the executor or administrator to the bank. Fill out any necessary forms to establish the account and deposit the check.