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What happens with bank account when someone dies?

When a person passes away, their bank accounts and finances do not immediately disappear. There is a legal process that determines what happens to the deceased person’s accounts and assets. Here is an overview of what generally happens to bank accounts when someone dies:

The Account is Frozen

When the bank is notified of an account holder’s death, they will typically freeze the account. This prevents any transactions from occurring until an executor or administrator is legally appointed to handle the estate. The bank will not allow anyone access to the account funds or information until they receive legal documentation appointing an estate representative.

An Estate is Opened

The next step is opening an estate account with the probate court in the state where the deceased resided. This involves filing paperwork and getting a court order appointing an executor or administrator. The executor named in the will or an administrator appointed by the court becomes the legal representative of the estate.

The Estate Representative Gains Access

Once appointed by the probate court, the estate administrator or executor gains legal rights to access information and funds in the deceased’s bank accounts. The bank will require a copy of the court order granting them authority over the estate. Then the representative can take actions like withdrawing funds, closing accounts, and disbursing money from accounts.

Outstanding Debts are Paid

One duty of the estate administrator is using the money in bank accounts to settle any unpaid debts the deceased had. This may include credit card bills, loans, medical expenses, taxes, etc. Accounts may need to remain open temporarily so debts and bills can be paid before closing the accounts.

Account Funds are Distributed

Once all outstanding debts and taxes are paid, the remaining money in bank accounts can be distributed to beneficiaries. If the deceased left a will, assets will be divided as stated in the will. Without a will, accounts are distributed according to state inheritance laws. Money may go to the surviving spouse, children, other family members, or the state itself.

Accounts are Closed

Finally, once all required payments are made and funds are distributed to beneficiaries, the estate representative will close the deceased’s bank accounts. They must submit paperwork to the bank proving accounts are ready to be closed. Remaining account balances will be distributed to beneficiaries or transferred to the state if beneficiaries weren’t named.

Special Rules for Joint Accounts

If the deceased person’s bank account was a joint account, the rules are a little different. With a joint account, the surviving account holder automatically inherits the account when the other holder dies. They gain full ownership and access to the account and can continue using it or close it at any time. The account funds do not go through probate unless the joint account holder was the deceased’s spouse in some states.

Timelines for Settling an Estate

The timeline for settling an estate and distributing bank account funds can vary greatly. A simple estate with just bank accounts may take a few months. A large or complex estate can take over a year. On average, expect 6-12 months for an estate to be settled fully before accounts are closed.

Hiring an Attorney

Dealing with bank accounts after someone’s death can get complicated, especially if there are estate disputes. Consider hiring a probate or estate planning attorney to help guide you through the process and ensure accounts are handled properly according to state laws.


When someone dies, their bank accounts are frozen until an estate representative is appointed by the court. The representative pays debts, distributes money to beneficiaries, and closes accounts. Joint accounts pass to the surviving owner immediately. Settling an estate can take several months to a year or more. Hiring a probate attorney is advisable to help navigate all the details.