Can I use payable-on-death accounts to pay estate creditors if other assets aren’t enough? - Pennsylvania
The Short Answer
Usually, no—not directly. In Pennsylvania, a payable-on-death (POD) or similar beneficiary account typically passes to the named beneficiary outside of probate, so it is generally not an estate asset the executor can simply use to pay creditors.
That said, creditors may still have ways to pursue certain non-probate transfers under other Pennsylvania laws, and whether a POD account can be reached often depends on the account type, ownership history, and the nature of the claim.
What Pennsylvania Law Says
POD and survivorship-style accounts are designed to transfer by contract at death, rather than through a will or the probate estate. That means the personal representative’s authority generally covers probate assets, while POD funds typically go straight to the beneficiary.
The Statute
The primary law governing this issue is 20 Pa.C.S. § 6306.
This statute establishes that transfers resulting from survivorship in a multiple-party account are nontestamentary—meaning they are not controlled by the will and are not treated as part of the probate transfer system.
Relatedly, Pennsylvania law also recognizes that, at death, funds in a joint account generally belong to the surviving party (or parties) as against the estate unless there is clear and convincing evidence of a different intent. See 20 Pa.C.S. § 6304.
Why You Should Speak with an Attorney
Even though POD accounts often bypass probate, an “insolvent estate” (not enough probate assets to pay valid debts) can create serious legal risk for executors and beneficiaries. Legal outcomes often depend on:
- Strict Deadlines: Pennsylvania has formal creditor-claim and estate-administration timelines, and missing them can change who gets paid and who may be personally exposed.
- Burden of Proof: Disputes over whether an account was truly intended to pass outside the estate (or whether it was funded in a way that creates estate rights) can turn on bank records and “clear and convincing” evidence issues under the Multiple-Party Accounts Act.
- Exceptions and “Other Laws”: Some non-probate transfers may still be vulnerable to creditor remedies depending on the asset type and facts. For example, TOD security registration law expressly notes it does not limit creditor rights under other Pennsylvania laws. See 20 Pa.C.S. § 6409(b).
If you are an executor trying to pay creditors, or a beneficiary being asked to “give back” POD funds, you should get legal advice before money moves—because the wrong payment (or the wrong refusal) can trigger litigation in Orphans’ Court.
Related reading: How does a named beneficiary claim a POD bank account after death in Pennsylvania? and What is the creditor claim period in Pennsylvania probate?.
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Disclaimer: This article provides general information under Pennsylvania law and does not create an attorney-client relationship. Laws change frequently. For legal advice specific to your situation, please consult with a licensed attorney.