By Linda M. Toga, ESQ.
The Facts: After my mother died, my father transferred his assets into a trust to avoid probate. He frequently told me how pleased he was that everything would pass to me and my sister without having to go to the Surrogate’s Court. After my father died last month, I discovered that he had a bank account that was in his own name. Apparently he did not transfer the funds in the account into a trust account.
The Question: What must I do in order to close the account?
The Answer: The situation you are facing is very common since it is not at all unusual for people to set up a trust but not transfer all of their assets into the trust. Luckily for you and your sister, closing the account should not be too burdensome.
The steps you must take to close your father’s account depend on the value of the account. If the account has a balance of greater than $30,000, and your father did not have a will, someone must apply to the Surrogate’s Court for letters of administration. Both you and your sister have priority over other family members when it comes to who can serve as administrator.
The petition for letters of administration must include information about the person who is actually applying for the letters in addition to information about your father, your family and the assets over which you are seeking control. You may have to give some people notice that a petition for letters is being filed and you may need to obtain waivers from other people. The Surrogate’s Court also requires an original death certificate and a check to cover the filing fee.
If your father’s account has a balance of greater than $30,000, and he died with a will, the person named as executor in the will should petition the Surrogate’s Court for letters testamentary. Like the petition for letters of administration, the petition for letters testamentary must include information about the petitioner, information about your father and his family and the assets that will pass under the will. The original will and an original death certificate must be included with the petition, in addition to a filing fee.
Depending on who was named in the will, other documents may be needed and you will likely need to give notice of the petition to certain people and obtain waivers from others. If the account is the only asset in your father’s name, the filing fee payable to the Surrogate’s Court for processing the petition, whether it’s for letters of administration or letters testamentary, will depend on the value of the account.
If the value of the account is less than $30,000, you can obtain the Surrogate Court’s permission to close the account by filing with the court an Affidavit in Relation to Settlement of Estate Under Article 13. The filing fee is only $1 and the affidavit is quite straightforward. In completing the affidavit, you will need to provide the name and address of the bank where the account is located, the account number and the balance in the account.
If satisfied with the affidavit, the Surrogate will issue you letters giving you authority to close the account. If you find other assets in your father’s name after filing the affidavit, you will have to file a new affidavit since the authority granted by the court in connection with the filing of an Affidavit in Relation to Settlement of Estate Under Article 13 is limited to the assets described in that affidavit.
To save time and ensure that you are handling the account properly, it is advisable to contact an attorney experienced in estate administration. That way you can be certain that the proper documents will be prepared and filed on behalf of your father’s estate.
Linda M. Toga provides legal service in the areas of estate planning, estate administration, Medicaid planning, wills and trusts, marital agreements, small business services, real estate and litigation from her East Setauket office.