[WSBAPT] How to deal with 15K payable to decedent's estate when no probate otherwise needed

Fri Jul 14 11:55:23 PDT 2023

I don’t know about banks opening small estate accounts, but clients should have no difficulty in obtaining an EIN by completing the Form SS-4 as if the small estate were actually a probate estate.  According to attorneys on the Oregon listserv, it is not a problem.  At least not for the IRS.
One interesting twist down here is that the Oregon statute has recently been amended to prohibit comingling small estate assets with the personal assets of the affiant.  That would seem to require a separate bank account.
I don’t know if that bank account would be in the name of the small estate or in the name of the affiant.  Either one sounds fine to me.
Phil Jones

Philip N. Jones
Duffy Kekel LLP
900 S.W. Fifth Ave. Suite 2500
Portland, OR 97204
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From: wsbapt-bounces at lists.wsbarppt.com <wsbapt-bounces at lists.wsbarppt.com> On Behalf Of Candace Wilkerson
Sent: Friday, July 14, 2023 8:26 AM
To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com>
Subject: Re: [WSBAPT] How to deal with 15K payable to decedent's estate when no probate otherwise needed

I never heard of a bank opening an estate account with a small estate affidavit; and agree with Julie’s advice.

Best,
Candace Wilkerson

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From: wsbapt-bounces at lists.wsbarppt.com<mailto:wsbapt-bounces at lists.wsbarppt.com> <wsbapt-bounces at lists.wsbarppt.com<mailto:wsbapt-bounces at lists.wsbarppt.com>> On Behalf Of Julie Martiniello
Sent: Friday, July 14, 2023 12:30 AM
To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com<mailto:wsbapt at lists.wsbarppt.com>>
Subject: Re: [WSBAPT] How to deal with 15K payable to decedent's estate when no probate otherwise needed

Hi Jon,

I have had many banks and credit unions allow use of a Small Estate Affidavit in this instance. Bank usually allows the claimant/heir to deposit the check into their own account (not an estate account). I do not think an estate account can be established without a court probate order, and do not think an EIN is needed since there is no formal estate.

I had almost  this exact situation about a month ago (insurance check from claim right before wife died. Insurance company issued check in name of wife/husband).

We were able to get the insurance to issue the check in the name of the "Estate of Wife". Then the client took the check to the credit union with the Small Estate Affidavit. The bank allowed him to deposit the check into his own account. My client was at Sound Credit Union. But I have had other clients use the small estate affidavit at many different banks.

On Thu, Jul 13, 2023 at 5:11 PM Jon Fritzler <FritzlerLaw at outlook.com<mailto:FritzlerLaw at outlook.com>> wrote:
Client received 15k check payable to the Estate of her deceased spouse as the result of a “critical illness” insurance policy that decedent had through his employer.  Apparently, there was no beneficiary designation on file.  No probate is otherwise needed because all other assets were owned jointly with client or she was named as beneficiary.

On her own, client filed a small estate affidavit and got an EIN and tried to open an estate account at her bank so she could cash the check.  Her bank refused to open an estate account without Letters Testamentary.  Bank suggested she ask the insurance co. to reissue the check in the name of her deceased spouse so she could deposit to a joint account  that is still open!  Not surprisingly, insurance company refused to do so.

Has anyone had any luck (1) getting a bank or credit union to open an estate account based on a small estate affidavit (if so, at which financial institution), or (2) getting an insurance company to reissue a check to the beneficiary of an estate based on a small estate affidavit.  Any other ideas, or is a probate necessary?

Sincerely,
Jon M. Fritzler
Attorney at Law
717 E. 22nd St.
Vancouver, WA 98663
Tel. 360.818.4431
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