Going through probate, why do I need to put all accounts into the estate?

Your mom doesn't make good interest on the accounts. She is no longer living. The ESTATE makes good interest and that is why the accounts now need to be put into the estate. When my brother died his assets could only remain in the good CDs for some months while the EIN was got. Then they had to either be distributed to the heirs or put into an estate account. The stocks cannot remain in your Mom's name. She isn't living/doesn't exist any more. I think that you need to spend some of this estate money now to sit with a Trust and Estate Lawyer and understand what you need to do. Tax time will be coming and you will need to pay taxes with this EIN as well. And one last tax filing for your Mom. So this cannot be done wrong and you need good guidance. The Estate pays for this guidance. Be certain not to trust Forums and such as if your answers are wrong you as a fiduciary are liable. My brother had me serving as his POA and Trustee for two years before his death, and I was his Executor and Trustee after death, and there were accounts with PODs and Account in Trust, and Checking Accounts, and such. Happily no stocks. And I was the only beneficiary so it made it easier. But yeah, it is a bit confusing. I only needed about one and one half hours of time with the Lawyer, but it was INVALUABLE. Do consider also going on Amazon and getting some books on being Executor of Estate. There are good books on Trust and Estate Administration.

I just completed probating my dads estate. His assets were fairly simple but it was still a very complicated process. My wife is a retired lawyer. She had never done this kind of work but was able to get us through the process. I could have never done it on my own. You should get a lawyer and pay him from your moms funds.

Yes you have to consolidate the funds into an estate account. No big deal as banks do it all the time. I assume there is a will naming you as beneficiary. Once probate is completed you will pay yourself, maybe funeral expenses, fees to the court and legal fees if any.

As for CDs and other investments they can be maintained during the probate process and still draw interest but will have to be closed out and placed in the estate account before probate can be completed. A word of caution on this: my dad had some CDs that were drawing decent interest so I let them ride for a few months during the probate process. I did accrue some interest but then had to file an after death tax return on that income. It was a hassle. I should have closed them out sooner.

Any account or asset that doesn't have a legal POD or is a joint account has to be put into estate account. Yes, you were paying all bills, etc, as POA, however POA ends at TOD.

My mother's primary account had 2 of us on it as joint owners for a long long time. That account still has some funds in it, but I'll eventually take what's left and close it. I did, prior to getting appointed as executor of the will, get a Tax EIN, using the online tool (it required multiple attempts as there was some kind of update happening and it would terminate, but eventually it went through.) I could not open the actual account until I was appointed.

Under normal circumstances, this might not be too difficult, unless there are a lot of assets remaining, esp if varied, like CDs, stocks, real estate, autos, etc. Because of the virus, everything is done online and the current system for our state is a bear! I have a lot of computer experience, but I can't imagine how the average person who doesn't gets through this process!!! For us, we could have skipped this whole process, as the real estate was sold several years ago, the car prior to that, SS went into a Rep Payee account and was used every month in full (refusal to pay the last month, in arrears, by SS is another sore topic!), pension went into that primary account and trust funds were deposited to that account to cover the balance of her MC and any other needs. There was literally nothing to be paid (other than taxes and tax prep, but that was using trust funds, which we 3 now "owned".) However, the refund of MC deposit plus interest, the second stimulus, the amt dep to open the SS account and the balance of the first stimulus they shorted my mother all require probate.

Because it is a bear to post a document and then have to update it, I haven't posted the accounting, as I'm waiting for a tax refund. Once that comes, it should be well beyond the 6 month waiting (unless that starts when the accounting is posted.) There are NO bills, no outstanding issues, so once posted, I should be able to distribute these funds to the 3 of us.

There will be another tax prep for both the trust (distributed most in March, so it will require another filing) and for my mother. Mainly one needs to do that final tax prep for the person IF there is income. In mom's case, none of these funds are income. The small amount being earned in interest should result in no tax due, but to keep the IRS happy and off my butt, I plan to file it.

The best we can do is be sure all assets are either assigned TOD or has a joint owner, done legally. There are cases, like ours, where money is coming in after the fact, that can't be dealt with any other way. BTW, the EC atty who had set up everything for us had suggested I just deposit the checks and not tell the bank she had passed!!!! I can't believe he would even think of saying something like that! A twenty dollar check, perhaps, but not the amount we're talking. No way!! It was bad enough managing everything and reporting to SS every year (pension was federal, which can request accounting. they never did until literally when she passed and it was for the year before - a whole year after the fact!!!) but no way was I going to take that suggestion! I don't need the IRS hassling me.

My condolences on your moms passing.
The issue for the banks & the brokerage house is that your moms accounts were done with her as the sole owner. So all in her name & tied to her SS#; and as she’s deceased that # can no longer be used. That why you are being told you will need an new #… the EIN for the estate. You can do it on line, but usually a bank officer will help you do it and the # from IRS/Treasury Dept is provided on the spot.
What banks usually do is freeze the accounts till a new EIN is done and then it switches over to using that EIN with a new checking account #. So if you need to pay bills, you need to do this sooner than later.

Yes it’s painful to have to cash out CD’s that are old & still paying high interest. It is what it is.

To have gotten around this, the accounts would have been POD (pay on death) to you & you would have probably been an existing co-owner (so bank has your SS#) & a signature on the accounts at the bank and for the stocks listed as the beneficiary. Since that wasn’t in place, a new EIN needs to be done.

Depending on what her assets are like…. By that I mean if she had a home, a car, different banks, more than 1 brokerage house…. You may need several “Letters Testamentary” issued from probate court and several death certificates. Lots of places want an original on each to do anything. And you tend not to get them back. So order extras.
It can be crazy as like the water co will be totally ok on just seeing the Letters & on leaving an active & current account in moms name but the power co will require both Letter & death certificate (which they keep) & will require power shut off with new account opened in the “Estate Of” and a deposit on the new account. If she had a home, expect to be inundated with calls and letters from investors (some are very sketchy) who want to buy the place or “businesses” who send a fraudulent smallish bill for work done on her property.

Are you using an attorney for probate?
Or are you going to DIY the process?
& was she on Medicaid, not MediCARE, but Medicaid?

She is getting 3% on her cds try getting that now, stocks i'm unsure of some of her accounts had me as a POD but not all she does have a house and land.

I had to pay to go through probate it's based on her assets worth and then you have to pay for each copy Letters Testamentary. I just feel like it's all setup to squeeze more money out of you during the worst time of your life.

I am using a attorney for probate they make it sound easy.

Thanks for your help.

Bob, only the accounts that do not have POD are part of probate.

If they have POD they now belong to you and bypass her final estate completely.

I am so sorry for your loss. I pray that God grants you strength, wisdom and comfort during this difficult time.

You are right, our government is going to get it pounds of flesh at every turn. Then the attorney will get his. It is costly to die in USA if you have anything and did not pre plan.

Bob, you should ask you attorney about completing probate. In my state I still have to send a final accounting to the heirs and show the court that taxes are paid up to date which has been complicated by my letting investments ride and having to file an additional tax filing. Now the IRS is just sitting on it. I have until October or I’ll have to ask the court for an extension.

Bob, there is a will? right?
OR
did she die “intestate”? that is without a will?
Each are very different processes to do.
On the “Letters Testamentary” you got from the court, to have gotten that document, I’m pretty sure that a valid will was presented to the court, accepted, and that why you are now officially the Executor and the Letters Testamentary is your authority to do things for the estate. Then it gets into whether you have an independent administration or a dependent administration. Dependent has court required oversight on actions. Each are in my experience way way different paths to do. If it’s a dependent administration, selling her house and land will take longer to do and your probably going to have to get an appraisal done on each to accompany that asset filing.

I ask as you posted concerns on heirs “coming out of the woodwork”. It seems you have a probate attorney, if so, all these ?’s & concerns of yours are things you need to be discussing with your probate atty. There are rather State specific formatting of how assets and claims against the estate are done, how Notices filed to publications, how distribution is done, how probate closed (if you have to actually close out probate).

If there is a valid will, then the terms of the will set up what the distribution is to be. If someone wants to contest the will, they can and it has to be done according to the schedule for probate for your state. If you pretty well know that the will is going to be contested, you should tell your attorney ASAP if you didn’t tell them all this initially. A contested will needs litigation probate atty IMO and most probate guys do not do litigation…. They will end up turning it over to one that does.

The Notice to Creditors starts the process for claim against the este and for if anyone is going to contest the will. Your probate atty should be doing the Notices and filing assets and claims but you as Executor have to provide to him the documents needed to do those filings…… like bills, receipts, cancelled checks that you do a copy of and give the attorney a list of items you paid out by date and for what. Usually the probate atty has a portal to probate court that is attached to their bar #; your atty submits the paperwork via this portal. Your atty’s firm will have the formats preset, you provide the info needed and they input and it’s off via email & scans to the docket attached to your moms unique PC case #. The online aspect of probate court is why probate atty costs tend to be lower than other type of legal work.
Realistically You need to be asking your atty your questions & concerns.

Please consult a lawyer that specializes in elder law or estate law in your area. She or he can give you the best advise. It seems that the law in you are is to liquidate all assets. Do whatever the law says yo must do. When you "inherit" the assets, then you can do as you wish with them.

How do you open Probate when there is no estate to Probate?

The state already sent notifications/requests for any remaining assets and/or proof there are no assets. The request and proof (of 0 funds, 0 assets to probate or pay/distribute). ) was mailed to the state, but haven't heard anything back. Death certificate was sent to all agencies and creditors.