Closing accounts
Opening an estate bank account
One account for everything the estate pays and receives.
An estate bank account is opened in the name of the person's estate, and managed by the executor. It keeps the estate's money separate from everyone else's, which makes paying bills and keeping records much easier.
What banks usually ask for
- Letters testamentary or letters of administration from the probate court
- A tax ID number for the estate, called an EIN
- A death certificate
- The executor's own ID
Getting an EIN
The IRS issues EINs for free, and many executors get one online in a few minutes at irs.gov. The estate uses it instead of the person's Social Security number.
What usually goes in and out
| In | Out |
|---|---|
| Money from closed bank accounts | Funeral costs, if not already paid |
| Final paychecks and refunds | Mortgage, utilities and insurance on the home |
| Proceeds from selling property | Valid debts and final bills |
| Interest and dividends | Taxes, legal fees, and final distributions to heirs |
Keeping records
Courts and beneficiaries can ask the executor to show what came in and what went out. Paying everything from one account makes that much simpler.
Good to know
Executors usually avoid paying estate bills from their own accounts. If they do, keeping receipts helps them get repaid from the estate later.