Disclaimer: This article explains how third-party claims and payments are typically recorded in Virginia probate files. It is educational only and not legal advice. For help with a specific estate or contested claim, consult a Virginia probate attorney.
Detailed Answer
When someone dies in Virginia, the personal representative (called an executor or administrator) must identify claims against the decedent, pay valid claims from estate assets, and record those actions in the probate filings and accountings submitted to the court. Accurate recording protects the estate, the personal representative, and the beneficiaries. The rules governing claims and probate accountings are found in the Virginia Code (see Va. Code Title 64.2, Wills, Trusts, and Fiduciary Relations and the chapters on claims and accountings: https://law.lis.virginia.gov/vacode/title64.2/ and https://law.lis.virginia.gov/vacode/title64.2/chapter5/).
Step-by-step process to ensure accurate recording
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Identify and preserve evidence of third-party claims.
Collect written invoices, contracts, statements, liens, and correspondence from claimants. Ask claimants for supporting documents such as signed work orders, delivery receipts, medical bills, or promissory notes. Save emails, texts, and paper records in a single folder labeled for the estate.
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Serve or publish notice to creditors as required by Virginia law.
Follow the notice-to-creditors rules in Title 64.2. The representative must provide the statutorily required notice (personal notice or publication) so possible creditors know how and when to present claims. See Va. Code Title 64.2, Chapter 5: https://law.lis.virginia.gov/vacode/title64.2/chapter5/.
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Require written, signed claims and verify them promptly.
Ask claimants to present written claims with evidence. Review each claim against estate records: confirm dates, amounts, contract terms, and whether the claim has priority (funeral, administrative, taxes, secured claims). Reasonable verification prevents paying duplicate or fabricated claims.
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Record acceptances, rejections, and compromises in writing.
If you accept a claim, document the acceptance, how the amount was determined, and the payment method. If you reject or dispute a claim, send written notice explaining the reason and keep a copy. If you negotiate or compromise, write and keep the settlement agreement and any release the creditor signs.
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Use a dedicated estate bank account and maintain a clear ledger.
Deposit all estate funds into one estate account (not a personal account). Record every receipt and disbursement with date, payee, purpose, amount, and check or transaction number. Cross-reference each payment to the underlying invoice or claim.
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Retain proof of payment.
Keep canceled checks, bank statements showing the electronic transfer, receipts, and signed releases from creditors. For large payments, obtain a written release or satisfaction of lien from the claimant before closing the estate.
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Prepare periodic and final accountings for the court.
When you file inventories, intermediate accountings, or the final account, include itemized lists of receipts and disbursements. Attach or retain backup documents (invoices, paid checks, releases). Virginia’s probate practice requires accurate accountings so the court and beneficiaries can review how estate funds were handled. See Va. Code Title 64.2 for account and settlement procedures: https://law.lis.virginia.gov/vacode/title64.2/.
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Handle disputed claims by reserving funds or petitioning the court.
If a claim is contested, set aside (reserve) funds in the estate account instead of paying until the dispute resolves. File a petition for instructions or for allowance of the claim so the court can decide. Document the reserve and the court filing in the accountings.
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Follow priority rules and tax obligations before making discretionary distributions.
Pay administrative expenses, funeral expenses, and taxes according to Virginia law and priority rules before making distributions to beneficiaries. Keep receipts and evidence of tax filings and payments.
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Obtain court approval when required.
For unusual, large, or disputed payments, or where the will or statute requires judicial review, seek the court’s approval before paying. Court-approved payments reduce later personal liability for the personal representative.
Practical example (hypothetical)
Suppose a decedent’s estate receives a $4,200 invoice from a contractor for roof repairs on the decedent’s house. The representative should: (1) verify the invoice and work order; (2) confirm the contractor presented a written claim after notice to creditors; (3) check estate funds and deposit money into the estate bank account; (4) record the payment in the ledger with date, check number, and invoice number; (5) obtain a signed receipt or lien release from the contractor; and (6) include the payment and the release documentation with the estate’s account filed with the court.
Where Virginia statutes come in
Virginia’s probate statutes set out creditor notice procedures, claim filing requirements, and the duties of personal representatives. For the statutory framework, see Title 64.2, Wills, Trusts, and Fiduciary Relations, and specifically the chapters dealing with claims and accountings: https://law.lis.virginia.gov/vacode/title64.2/ and https://law.lis.virginia.gov/vacode/title64.2/chapter5/.
Helpful Hints
- Open and use a dedicated estate bank account immediately.
- Keep original invoices, contracts, signed releases, and canceled checks in a single, indexed file.
- Get written releases from claimants when you pay them—especially for lienable services.
- Record check numbers, electronic transfer IDs, and bank confirmations in the ledger.
- Do not pay claims that are clearly invalid; instead, notify the claimant in writing and document the reason.
- When in doubt about priority, disputed claims, or large payments, file a petition for instructions with the court before distributing funds.
- Consider using accounting software or a spreadsheet designed for estate accounting to reduce errors.
- Keep beneficiaries informed with copies of inventories and accountings—transparency reduces disputes.
- When tax or complex issues arise, consult a Virginia probate attorney or a CPA experienced with estate tax/accounting matters.
Accurate recordkeeping and prompt, documented action protect the estate and the personal representative from later claims. Use the statutory guidance in Va. Code Title 64.2 and consult counsel for complex or contested matters: https://law.lis.virginia.gov/vacode/title64.2/.
Final note: This information is educational and not legal advice. For an estate with contested claims, complex assets, or tax exposure, consult a licensed Virginia attorney who handles probate.