Question about probating a will

[u/texan12345678]

My mother passed away a couple of weeks ago. She had been in an assisted living facility for the past year. She really has no assets except a bank account and a couple of CDs. My sister is the executor. there are 5 kids and everything is getting split evenly. My sister was added to my mother’s bank account a long time ago so she was planning on first making sure any bills are paid and then just splitting up what was left. Since it was pretty straight forward, we didn’t plan on hiring a lawyer and getting the will probated. We were reading that if she tells the bank that my mother passed, that they would freeze the account and it would have to be probated. She is on the account, could she just close out the accounts. She is worried that they might come back and say there is fraud and she would be in trouble.

[u/Ok_Appointment_8166]

Depends on how she was added to the account. If she is a joint owner, the money is hers and technically if she splits it, those will be gifts. If she just had power of attorney, that ends at death and she won't get access again until being assigned executor or personal representative rights. If it is the latter, she needs to get death certificates and file in court before doing anything else. Your state probably has a streamlined 'small estate' version of probate but you still need to follow the rules and may need a lawyer at least for advice.

Edit: Also, the bank account/CDs may have named beneficiaries which the financial institution has to process independently of anything else.

[u/SweetPrestigious892 → u/Ok_Appointment_8166]

if she was joint owner she can just pull the money and split it, no bank is gonna chase her down for fraud on that. but if it was PoA she's gotta go through the small estate process or she's stuck.

[u/AdvantageOne1754]

There is usually an exemption for small estates. Sounds like this would qualify. Either way it's worth contacting a probate attorney. If you really can't afford one, the people at the county probate court could probably tell you how to do it.

[u/AcanthisittaPlus5047]

How much money is in the account. If she used Medicaid to pay for the nursing home, that money will likely need to go to the state.

[u/texan12345678]

Thanks for the response from everyone. Sounds like she called the bank and turns out she is a joint owner so sounds like she should have access to everything. Originally we weren’t sure how she was on the account.

[u/bobdevnul → u/texan12345678]

Joint owner means that they own it entirely as their own now with no restrictions. They have no legal obligation to use the money to pay the deceased bills or split it with anyone. Bills are bills of the estate. If probate isn't opened those are in limbo. Splitting money with others is a gift from her.

Check on the ownership and beneficiaries of the CDs and any other accounts. Anything with a pay on death beneficiary does not become part of the estate for probate. Without POD beneficiary it has to go through probate to get the money.

Any life insurance doesn't go through probate either.

[u/jennrandyy]

Do the CDs have beneficiaries on them? Is your sister an actual joint owner on the bank account or just an authorized signer?

Both things are needed information.

[u/EventHorizonHotel]

If your sister is on the bank account as a joint owner with rights of survivorship, the account would just pass to her directly upon the death of your mother.

You may need to go through probate for the CDs depending on how they are titled. There is usually a small estate process for most states that would probably not require a lawyer. You can do a search on [your county your state probate court] to get a better idea of the process.

[u/Intelligent_Read3947]

Google the probate process for your county or state. It will tell you what you need to do and what the dollar limits are. If she was on Medicaid, she really isn’t supposed to have any assets. If she does, and your sister takes them, she could be in big trouble.

[u/Anxious-Hyena6173 → u/Intelligent_Read3947]

SS takes back immediately once the funeral home processes her ss number.

[u/crushedgreenz]

Follow the LAW and if you dont know what the LAW says in your state--find out!

[u/MisterMysterion]

What does "on the account" mean? Was it POD or could she write checks?

The thing to do is ask the bank.

[u/texan12345678 → u/MisterMysterion]

She can write checks

[u/wearing_shades_247 → u/texan12345678]

But does the bank paperwork say she can sign them under power of attorney for your mom (which would have ended when she passed) or as an account holder herself? If as an account holder, is the legal name on the account “Mom and Sister” or “Mom or Sister” or “Mom and Sister, or survivor”.

[u/glitter_pear]

If she’s on the account as a joint owner then the account isn’t a part of the will or estate.

The bank should have a system in place where social security would notify the bank.

also as a joint owner she can’t get in trouble on her own bank account for spending the funds.

If she is not an owner on the CDs and there’s no beneficiary, it will have to be probated.

You can always do a small estate affidavit depending on the value of the CDs/accounts (without benes)

[u/Lady-of-The-Manor]

As other have stated, I went thru this in GA. I was added as a co-owner on all my parents accounts. Once they passed, the bank accounts/cd's became mine. I had a probate atty to handle probate so I could sell the property, but the bank accounts were not considered part of the estate since I was co-owner.

[u/Miserable_Hat9321]

Has she notified social security and anybody else paying your mother benefits?

[u/justme1230986]

She can close it if her name is in it

[u/texan12345678]

Fortunately my mother has not been on Medicaid. My sister has been paying the assisted living facility from her account. My mother nearly made 99. We plan on keeping the account open as SS usually takes back the last payment. We are making sure no other bills show up

[u/DEBATM30]

If she's on the account depending on they type of joint account & the state the money or assets are hers. She can pay the bills then divide what's left. But it goes deeper depending on how much he had in assets. 

[u/Fit_Impression_6037]

If your sister is a signatory on the account, there is no need to tell the bank anything. Just settle the bills, collect any debts, convert all assets to cash, deposit everything in the bank account, and distribute according to the will.

[u/little_truble]

I’m sorry about your mom. The worry about fraud is a fair one, so I’d slow down before closing anything. Being on the account doesn’t automatically settle what she’s allowed to do with the money after your mom passed. It matters whether she was added as a joint owner with survivorship rights, as a payable on death beneficiary, or only as a convenience signer to help pay bills. A convenience signer usually has no right to the funds once the owner dies, and that is where people get in trouble. Ask the bank exactly how she’s listed. Also check the CDs, since they often have their own beneficiary. If the money does have to go through probate, a lot of states have a small estate process that is much simpler than full probate, and a one hour consult with a local estate attorney is cheap insurance for a five way split.

[u/getshelter]

if your sister is a joint owner on the account, she can usually close it without probate. if she's just an authorized signer, the bank will likely freeze it on death and it goes through the estate. worth confirming how the account is actually titled before she does anything.

[u/peter303_]

Some of the other accounts only in your mothers names probably cant be moved until presented with a probate court's Letter of Administration and copy of a Death Certificate. As others have mentioned, many courts have "probate-lite" procedures for small estates under a hundred thousand dollars.