Should a Personal Representative Open an Estate Account in Missouri?

Disclaimer: This article provides general information and is not legal advice.

Detailed Answer

Under Missouri law, a personal representative (formerly known as executor or administrator) must keep estate funds separate from personal assets. Missouri Revised Statutes § 473.733 requires the representative to deposit all money received on behalf of the estate into a separate fiduciary bank account. This account often goes by the name “Estate of [Decedent’s Name], Personal Representative, [Bank Name].”

Opening an estate account ensures transparent accounting and safeguards beneficiaries’ interests. It allows the court and interested parties to track receipts, disbursements, and earnings such as interest. Mixing estate funds with personal accounts can lead to allegations of mismanagement or breach of fiduciary duty under Mo. Rev. Stat. § 473.777.

Steps to open the account:

1. Obtain Letters Testamentary or Letters of Administration from the probate court.
2. Apply for an Employer Identification Number (EIN) from the IRS specifically for the estate.
3. Present certified letters and EIN to a bank or trust company authorized to do business in Missouri.
4. Title the account clearly to identify the estate and personal representative.

Keeping detailed records is crucial. Missouri courts expect accurate ledgers showing deposits, expenses paid (such as funeral costs, taxes, administrative fees), and distributions to beneficiaries. Proper record-keeping reduces disputes and simplifies final accounting filings with the probate court.

Failing to open a separate estate account can expose the personal representative to personal liability and court sanctions. If an account was not established promptly, the court may require a detailed explanation and may limit compensation for the representative’s services.

Helpful Hints

• Open the estate account within 30 days of appointment to avoid delays and allegations of mismanagement.
• Maintain duplicate copies of all bank statements, canceled checks, and deposit receipts.
• Only pay estate expenses from the estate account. Avoid writing personal checks on this account.
• Track interest earned by the account. Interest generally belongs to the estate and must be reported in final accounting.
• Use accounting software or spreadsheets to categorize transactions: funeral costs, taxes, legal fees, and distributions.
• Consult the Probate Division of the Circuit Court in the county where the decedent lived for local forms and filing procedures.
• Provide beneficiaries with periodic account statements to maintain transparency and trust.
• Before closing the account, secure court approval of the final settlement and distribution plan.