Opening a Bank Account for Estate Funds

Shortly after being appointed as an estate executor, you may want to have an account opened under the estate name. In most cases, the method for an estate account will be listing the deceased name along with the executor name.

Deciding on Account Type

The account you open needs to allow checks to be written. This will enable the bills to be paid and to eventually make distributions among the beneficiaries. So your circumstances will decide on what type of account to open.

As probate is taking place, the use of a normal checking account will be sufficient. ANy type of funds can be deposited into a checking account, which can then be used to make bill payments and final expenses. This checking account will be perfect if the amount to be deposited is significant in nature.

If you believe that an estate will involve more than just cash, then an account that works well with money and investments will be perfect. These accounts can usually be opened through an investment institution such as Vanguard, Fidelity, or Charles Schwab. No matter what, the brokerage firm needs to allow for check writing privileges. It is also a good idea to have only one account statement so that your records are kept simple.

Apply For an IRS Taxpayer ID (EIN)

When you open an estate account, there will need to be a taxpayer ID as well. This is because the IRS considers the account to be a taxpayer. You can obtain the number by mail or by calling the IRS directly.

Utilizing The Estate Account

One the account is active, you need to transfer all funds from existing accounts into the single estate account. Make sure to leave payable-on-death accounts alone because they are separate accounts. You should also make deposits of income that a deceased individual receives as well as proceeds from investments, stocks, or other income that generates income continuously.

This money will allow the bills to be paid and the administration of the estate maintained.

Make sure that record keeping is perfect and that all deposits and withdrawals are accounted for in a ledger. This also includes keeping track of the written checks so that the amounts are always accounted for and the balance adds up. If you experience any carelessness with the account, then you will be responsible for the financial problems the account is having.

Also, it is a good idea to keep your personal funds out of the estate account. If you have no choice but to pay a bill using your own money, then be sure that the reimbursement is a meticulous record that can be accounted for.

To Find Out More

If it is your first time as an executor, it is a good idea to become familiar with the process. That is why we will be able to assist you in the entire process of opening an estate bank account as soon as you give us a call today.

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