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Opening up your probate bank account

On Behalf of | Jun 7, 2023 | Estate Planning

Being tasked with handling an estate in Florida is a serious prospect. You can be exposed to several legal conditions that may be entirely new. One of them will be the task of opening a probate bank account. This is the money in the estate bank account that you can use for a number of purposes. These can include paying off debts and probate costs.

Why you need an estate account

An estate account can be an essential part of the probate process. Opening this type of account can help you keep the financial issues of the deceased person you represent separate from your own. This is crucial when it comes to tax time.

When you open an estate account, you establish a means of paying off all the debts that the deceased person may still owe. You will now have a clear record of what the expenses were and how the funds in the estate were used to pay them. This will help to keep you off the hook when you take on this responsibility.

Estate accounts are not trust accounts

An estate account is very different from a trust account. A trust account comes with a beneficiary and is usually managed by a trustee. The executor has no control over its direction. This type of account almost always manages to avoid probate. As a result, beneficiaries can receive their money much sooner.

By contrast, the assets of a deceased person are usually frozen at the time that they pass away. This means that the amount of money in the trust may be finite. In some cases, they may still continue to receive income. You will thus require an estate account to oversee and pay out these funds.