Annual and Final Probate Accountings — What statements and financial documents does New Hampshire require?
Disclaimer: This is general information only and not legal advice. For guidance about a particular estate, consult a New Hampshire probate attorney or the probate court handling the estate.
Detailed Answer
When someone serves as a personal representative (executor/administrator) or trustee in New Hampshire, the probate court will require clear, organized financial accountings so the court, beneficiaries, and creditors can see how estate assets were handled. Accountings come in two common forms:
- Annual accountings: Periodic reports a fiduciary files while administration continues.
- Final accounting (closing account): A full, closing report filed when the fiduciary asks the court to approve distributions and close the estate.
New Hampshire law and court practice expect accountings to present complete, verifiable financial information. Although the exact items a court will demand can vary with the court order and the estate’s complexity, the typical required statements and documents include the following.
1) Inventory and opening statement
– A signed inventory listing all probate assets as of the date of appointment (real estate, bank and brokerage accounts, retirement accounts, business interests, personal property). Courts commonly require an initial inventory soon after appointment. See the New Hampshire Revised Statutes and local probate rules for timing and form guidance: https://www.gencourt.state.nh.us/rsa/html/ and the New Hampshire Judicial Branch probate resources: https://www.courts.nh.gov/.
2) Detailed schedule of receipts
– Dates and sources of all income and receipts received by the estate during the accounting period (sale proceeds, rent, dividends, interest, refunds, life insurance or retirement plan proceeds paid to the estate). Include copies of settlement statements, sale closing statements, deposit slips, and brokerage trade confirmations that show funds were received by the estate.
3) Detailed schedule of disbursements
– All payments from estate funds, grouped and explained (funeral costs, taxes, creditor claims paid, administrative expenses, repairs and maintenance, real estate closing costs, payments to third-party professionals, fiduciary compensation). Support each disbursement with source documents: paid invoices, canceled checks, bank statements showing withdrawals, and vendor receipts.
4) Bank and brokerage statements
– Full account statements for every estate bank account, investment account, and custodial account covering the accounting period. Courts rely on these statements to confirm opening balances, receipts, and ending balances.
5) A running cash reconciliation (ledger)
– A ledger showing beginning cash, all incoming receipts, all disbursements, and ending cash balance. This ties the narrative accounting to the bank statements and shows how cash flows were handled during the period.
6) Asset valuation documentation
– Appraisals, broker statements, certified valuations, or comparable sales data that support values assigned to assets in the inventory or at distribution. If real estate or unusual assets were sold, include the closing statement.
7) Creditor claims and proof of notice
– Copies of filed creditor claims, notices sent to known creditors, and proof of payments or rejections. If any claim remains unpaid, identify the reason and court direction.
8) Tax filings and tax clearance information
– Federal and New Hampshire estate and income tax returns filed for the estate during the accounting period (or an explanation if none were required). Include any correspondence or lien releases from tax authorities. Tax obligations often must be satisfied or reserved for before final distribution.
9) Proposed distribution schedule (for final accountings)
– A detailed proposed plan showing precisely how remaining assets will be distributed to beneficiaries, with calculations showing how each distribution was computed, and any proposed withholding or reserves for unresolved claims or taxes.
10) Petitions, fee requests, and supporting affidavits
– Copies of the petition asking the court to approve the accounting and close the estate, a schedule of requested fiduciary and attorney fees, and supporting documentation for those fees (time records, invoices). The court will want documentation showing reasonableness of fees charged against the estate.
11) Other supporting documents
– Real estate deeds, vehicle titles, contract copies affecting estate transactions, buy-sell or shareholder agreements if business interests are involved, and any court orders that affect assets or distributions.
How the materials are presented matters. Courts prefer concise, organized accountings that tie narrative explanations to supporting documents. Use a table of contents, reference exhibit labels (Exhibit A — bank statements; Exhibit B — receipts), and use clear reconciliations that let the judge and interested parties follow the cash flow from start to finish.
Where to confirm exact requirements: New Hampshire probate courts set forms and local practice rules. Check the New Hampshire Revised Statutes for probate law and the state court’s probate resources for forms and filing procedures: New Hampshire RSA index: https://www.gencourt.state.nh.us/rsa/html/ and Judicial Branch probate information: https://www.courts.nh.gov/.
Practical example (hypothetical)
Imagine you are the executor of an estate in Concord, NH. You open an estate checking account and receive $150,000 from a brokerage sale and $10,000 from life insurance. During the year you pay $5,000 in funeral costs, $2,000 in home repairs, and $1,200 in utility bills. For an annual accounting you would typically submit:
- Initial inventory listing the brokerage account (pre-sale), house, and personal property.
- Bank statements for the estate checking account covering the year.
- Brokerage sale confirmation and closing statement showing the $150,000 deposit.
- Receipts/invoices and canceled checks for the $8,200 total disbursements.
- Ledger reconciling the beginning cash, receipts, disbursements, and ending cash balance.
- Short written narrative explaining why funds were spent and any planned actions (e.g., sale of real estate pending).
When the court will want a final accounting
File a final accounting when you ask the court to allow final distributions and discharge the fiduciary. The final package must show all transactions from opening to closing, evidence that taxes and valid claims were handled or reserved for, and a detailed distribution schedule. The court will not approve distribution unless the accounting supports the proposed transfers and any statutory obligations are met.
Helpful Hints
- Keep contemporaneous records. Save invoices, canceled checks, and closing statements as transactions occur.
- Keep estate funds separate. Never mix personal and estate funds. Use a dedicated estate account and retain full bank statements for the record.
- Label exhibits. Attach supporting documents as exhibits and reference them in the accounting for easy review.
- Document valuations. Use written appraisals or reliable market data to support asset values, especially for unique or high-value items.
- Set aside reserves for taxes and disputed claims. Explain and document any reserves the fiduciary keeps instead of paying or distributing funds immediately.
- Request guidance early. If you are unsure what the court expects for a specific asset or transaction, ask the probate clerk or request a court conference to avoid re-filing later.
- Consider professional help. For complex estates, use an accountant or attorney to prepare accountings and ensure tax compliance.
- Check local forms and rules. Courts may have required forms or local procedures for submitting inventories, accountings, and petitions. See the New Hampshire Judicial Branch and the NH RSA index for statutes and forms: https://www.courts.nh.gov/ and https://www.gencourt.state.nh.us/rsa/html/.
If you need help organizing an accounting packet or want to confirm what your local probate court requires, consult a New Hampshire probate attorney or contact the probate court clerk for filing instructions.