Estate account
A bank account in the estate's own name. Estate money must not pass through anybody's personal account.
What it means
A check payable to "the estate of" somebody cannot be paid into a personal account, and a personal representative who runs the estate's money through their own is commingling — a breach of duty in itself, whatever their intentions and whatever the outcome.
The account is opened in the estate's name, using the estate's own employer identification number rather than the deceased's Social Security number, and the bank will want the certified letters as evidence of who may sign on it.
Everything the estate receives goes in and everything it pays goes out, which makes the account the accounting. Reconstructing an estate from a mixed personal account, at the point where a beneficiary asks a question, is where most estate disputes about money actually start.
It is not the same as the deceased's own account, which is frozen at death and closed rather than converted. A joint account with a surviving owner is a third thing again and is generally not the estate's money at all.
Why it matters
Commingling is a frequent breach an ordinary, honest executor commits, and it is invisible until somebody asks for an accounting.
It is also the practical answer to "how do I cash a check made out to my mother's estate", which is a question with no other answer.
When you are likely to meet it
- When a refund, a final pay check or an insurance payment arrives payable to the estate.
- When the bank asks for an EIN rather than a Social Security number.
- When the estate has bills to pay before anything has been collected.