An estate account is opened by the official representative of an estate (often called the administrator or executor of the estate), after a court (usually called a probate court) appoints that representative. Accounts of the deceased individual are transferred to the estate account, and the estate account is also used to collect money due to the estate (such as insurance proceeds, refunds, rebates, debts owed to the deceased, proceeds from the sale of estate property, etc.). |
The estate representative is responsible to the court for all the assets of the estate. He or she uses the funds in the estate account to pay taxes and other obligations of the estate (including final medical and funeral expenses, debts, etc.). Remaining funds are distributed to heirs, charities, trusts, etc., according to the decedent's will and/or state laws.
Published on BankingQuestions.com 6/28/07