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  1. #1
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    Default Do You Have to Put a Deceased Person's Funds Into an Estate Account

    My question involves estate proceedings in the state of: Alabama

    Background: My mother passed away in July. She lived with me in Alabama for the last 3.5 years, and I am a joint (primary) owner of her bank accounts. Her will is not legally valid, since it was not signed by two non-family witnesses. However, my sister and I, the only legal heirs, agree that we want to do everything according to Mom's will. Her only assets that require probate are a trailer and land in Mississippi. Most of her money is to be held for grandchildren's college education, but some is to be given to family. Since I've managed her finances for the last few years, I'm pretty certain that Mom doesn't have any unknown creditors. There may be some minor bills outstanding.

    The lawyer whom I've hired to do the intestate work suggested that I transfer Mom's money from the joint account to an estate account, so that there will be a clean paper trail showing how it is used over the next several years. However, then the money will be subject to the intestate process and the six month waiting period for unknown creditors.

    What are the potential pros and cons of doing as the lawyer suggested?


    Thanks.

  2. #2
    Join Date
    Mar 2013
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    Default Re: Should I Put Mom's Money in the Estate?

    The lawyer whom I've hired to do the intestate work suggested that I transfer Mom's money from the joint account to an estate account, so that there will be a clean paper trail showing how it is used over the next several years. However, then the money will be subject to the intestate process and the six month waiting period for unknown creditors.

    What are the potential pros and cons of doing as the lawyer suggested?
    Only cons, no pros.

    You've already suggested a big one. Ties up the money.

    The other is that is that it gives the lawyer a bigger pot to stir with which to charge you more fees. (No offense to the respected lawyers who participate here.)

    Besides, it was a joint account. The money is yours, as I noted in your previous thread (to which this should have been appended for continuity).

    https://www.expertlaw.com/forums/sho...t=#post1093549

  3. #3
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    Default Re: Should I Put Mom's Money in the Estate?

    The money in the joint account/is yours. I would not place it in the estate account. You can always put into the estate account what is necessary to pay estate bills if the estate doesn't have enough to cover expenses.

    I agree with Jack.

  4. #4
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    Default Re: Should I Put Mom's Money in the Estate?

    It's a moot point. If, as you said, you were "a joint (primary) owner of her bank accounts," then any money in those accounts belongs to you and is not part of your mother's estate. I suggest you discuss this with your lawyer.

  5. #5
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    Default Re: Do You Have to Put a Deceased Person's Funds Into an Estate Account

    The above statements assume that the account included an explicit right of survivorship. No right of survivorship exists in an joint account in your state unless explicitly created when the account is established. Alabama has eliminated what was previously a conclusive presumption of joint ownership an donative intent in a joint account.
    Quote Quoting Alabama Code, Sec. 35-4-7 Survivorship between joint tenants.
    When one joint tenant dies before the severance, his interest does not survive to the other joint tenants but descends and vests as if his interest had been severed and ascertained; provided, that in the event it is stated in the instrument creating such tenancy that such tenancy is with right of survivorship or other words used therein showing such intention, then, upon the death of one joint tenant, his interest shall pass to the surviving joint tenant or tenants according to the intent of such instrument. This shall include those instruments of conveyance in which the grantor conveys to himself and one or more other persons and in which instruments it clearly appears that the intent is to create such a survivorship between joint tenants as is herein contemplated.
    Your lawyer appears to be operating from the impression that there was no right of survivorship in the funds, and that they belong to the estate. This is something to clear up with your lawyer, rather than risking being later accused of a breach of fiduciary duty or fraudulent conveyance by a creditor that was not given proper notice of the estate so as to make a claim for payment.

  6. #6
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    Default Re: Do You Have to Put a Deceased Person's Funds Into an Estate Account

    Quote Quoting Mr. Knowitall
    View Post
    The above statements assume that the account included an explicit right of survivorship. No right of survivorship exists in an joint account in your state unless explicitly created when the account is established. Alabama has eliminated what was previously a conclusive presumption of joint ownership an donative intent in a joint account.

    Your lawyer appears to be operating from the impression that there was no right of survivorship in the funds, and that they belong to the estate. This is something to clear up with your lawyer, rather than risking being later accused of a breach of fiduciary duty or fraudulent conveyance by a creditor that was not given proper notice of the estate so as to make a claim for payment.

    Re the bolded: Does that mean that even a married person would not automatically own the money in a joint account unless they specifically created that kind of account?


    He also said that he was the primary account owner. Would that still apply in that case?

  7. #7
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    Default Re: Do You Have to Put a Deceased Person's Funds Into an Estate Account

    This is a parent-child relationship, not a marital relationship. Statutes and case law addressing the division of marital assets would not provide anything useful or relevant for the question before us. There is no "unless you call yourself a primary account holder" exception to the statute.

  8. #8
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    Default Re: Do You Have to Put a Deceased Person's Funds Into an Estate Account

    Thanks *very* much for your replies. I'll check with the credit union and with the lawyer.

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