If you are looking into how to open an estate bank account, someone you know must have passed. Unfortunately, death is fact of life, which no one yet has managed to escape. With death, most times comes the challenging task of opening an estate. Determining precisely how to open an estate account does not have to be difficult. So here’s what you need:

Letters of Administration or Letters Testamentary – first and foremost, you need one of these type of letters to open an account.  Without court issued letters of administration (no will) or letters testamentary, you have no authority over the deceased’s money or funds that belong to the estate. You must apply for these letters by filing a petition with the New York Surrogate’s Court to be appointed as the estate’s administrator or the executor of the will. If the deceased died with a will, a petition for probate must be filed with the probate department. On the contrary, if the decedent died without a will, a petition for letters of administration must be filed with the administration department.  Each New York county has its own Surrogate’s Court. Choosing where to file is easy: it’s the county where the decedent lived (not died). For example, Jack lived in Manhattan, but died at Maimonides Medical Center in Brooklyn (Kings County). Jack’s estate must be commenced in the New York County Surrogate’s Court.

Death Certificate – most banks will accept a copy of the death certificate in lieu of the original. Original a/k/a certified death certificates can be hard to come by. The funeral home will typically provide five certified copies. If you only had one on hand, that original should have been used to open the estate with the Surrogate’s Court. You can always get a copy of what you filed from the Court, but they will not return the original. To get more death certificates, you will have to visit the Department of Health at 125 Worth Street, Room 125, New York, NY 10013, or place an order online.  The bank will not accept a copy of letters of administration or letters testamentary – they must be court-certified – but you can probably get away with a copy of the death certificate. Call the branch to confirm before heading out with papers in hand. l

Employer Identification Number (EIN)

The EIN is the equivalent of a social security number for the estate. Just as you need your SSN to open an individual bank account or an EIN to open a business account, you need an EIN to open an estate bank account. After obtaining administration letters or letters testamentary, you can apply for an EIN online on the IRS website. You will need the decedent’s date of death and SSN. You’ll also have to provide your address, SSN, and your role in the estate ie executor, trustee, or administrator.

Why You Need an Estate Account

You will need to open an estate account to collect rental income or hold sale proceeds if you sell real estate. If the decedent had banks account in his name alone, you will have to liquidate these accounts and transfer the balances into the estate account. The newly established account will be used to pay expenses and ultimately to make distributions to the beneficiaries or the heirs. The money cannot be held in your individual name. You also want to make sure that all liabilities of the estate are paid before you make distributions.  Some expenses may arise that you were not aware of from the start, such as medical expenses and creditor claims. If you distribute the money too soon or right away, you may have to chase after the beneficiaries to pay their share of the expenses.

Where to Open an Account

There is no rule concerning where you can and cannot open an estate bank account. Most bank branches will be happy to assist you in setting up a checking account for the estate. Some may charge a monthly maintenance fee, so I would shop around before settling for a bank.

Hiring a New York Probate Lawyer

The dangers of properly setting up an estate and obtaining an EIN, without a NY probate lawyer, are always present.  It is very common for administrators and executors to encounter management problems concerning the estate, when going about it without an estate attorney.  Even if you do have legal representation, make sure that the person you retain practices in the realm of NY estate law. If you need representation or simply a consultation, call us at 646-233-0826. Applying for letters of administration and letters testamentary is what we do on a daily basis.