Should a Personal Representative Open an Estate Account to Handle Estate Funds?
Disclaimer: This article is for educational purposes only and does not constitute legal advice. For advice specific to your situation, consult a qualified attorney licensed in New Hampshire.
Detailed Answer
When someone passes away, the personal representative (also called an executor) must gather, manage, and distribute the decedent’s assets according to the will or New Hampshire law. One critical task is handling estate funds. Opening a dedicated estate bank account is strongly recommended—and in some cases required—under New Hampshire law.
RSA 551:5 requires fiduciaries to deposit all estate money into an account in a bank authorized to do business in New Hampshire. This separate account holds cash proceeds, rental income, interest, and other liquid assets. Keeping estate funds segregated from the personal representative’s own money helps prevent commingling, simplifies accounting, and protects the representative from allegations of mismanagement.
In addition, RSA 551:17 mandates that the personal representative maintain accurate records for all receipts and disbursements. A separate estate account creates a clear paper trail. When you file your inventory or final accounting with the Probate Court, your bank statements serve as evidence of proper fiduciary conduct.
Failure to open an estate account or mixing personal and estate funds can lead to personal liability, surcharge, or removal as personal representative. Courts take commingling seriously because it undermines the transparency required of fiduciaries.
Key Steps to Open an Estate Account
- Obtain Letters Testamentary or Letters of Administration from the Probate Court.
- Choose a New Hampshire bank or credit union, as required by RSA 551:5 (RSA 551:5).
- Provide the bank with certified court documents and the decedent’s death certificate.
- Deposit all estate cash, checks, and other liquid assets into the new account.
- Keep meticulous records of every transaction to comply with RSA 551:17 (RSA 551:17).
Helpful Hints
- Label the account “Estate of [Decedent’s Name], John Doe, Personal Representative.”
- Get multiple bank statements each month and file them with your records.
- Use the estate account exclusively for estate expenses—funeral costs, taxes, creditor claims, and distributions to beneficiaries.
- Review New Hampshire’s Probate Court website for forms and filing deadlines.
- Consult a probate attorney if you encounter complex assets like retirement accounts, real estate, or business interests.