Do Bank Accounts With Beneficiaries Go Through Probate?

When someone dies, even seemingly simple assets like bank accounts can become complicated fast. Whether those funds can get transferred to loved ones or go to probate often comes down to a few small details most people overlook. Understanding how beneficiaries, account ownership and probate rules work can help you avoid surprises while ensuring your money ends up where you intend.

A financial advisor can help structure an estate plan that addresses probate timing and costs for your beneficiaries.

What Happens to Bank Accounts When You Die?

What happens to a bank account after someone dies largely depends on the account’s titling and the naming of a beneficiary. Some accounts transfer automatically to another person, while others become part of an estate and sometimes require probate. This distinction can significantly affect how quickly heirs can access funds and how complicated the process becomes.

Many bank accounts allow you to name a payable-on-death (POD) or transfer-on-death (TOD) beneficiary ¹ . When the account holder dies, the funds typically pass directly to the named beneficiary to avoid probate. The beneficiary typically needs only to provide identification and a death certificate to claim the funds, making this one of the simplest ways to pass on cash assets.

Joint accounts with right of survivorship usually pass automatically to the surviving account holder ² . The remaining owner becomes the sole owner of the funds, and the account skips probate. This is common for married couples or partners who share finances, but it also means the funds bypass instructions in a will.

If a bank account is without a beneficiary designation and it is not jointly owned, it typically becomes part of the deceased person’s estate ³ . In this case, the funds typically pass through probate and are distributed according to the will or, if there is no will, under state intestacy laws. This process can take months and may delay access to the money.

How to Determine What Happens to a Bank Account When Someone Dies

The first step is to identify how the bank account is titled. An individually owned account has different treatment from a joint account with rights of survivorship. The title determines whether the account can transfer automatically to another person or must be handled through the estate.

Next, confirm whether the account has a payable-on-death or transfer-on-death beneficiary. Banks keep beneficiary forms on file, and these beneficiary designations usually override instructions in a will ⁴ . If a valid beneficiary is named, the account typically passes directly to that person without probate.

Each financial institution has its own procedures for handling accounts after a death. Reviewing account statements and original paperwork, or contacting the bank directly, can help determine the required documentation and the authorized party to claim the funds. A death certificate is almost always necessary.

If the account has no beneficiary and no surviving joint owner, it generally becomes part of the estate. In that case, the executor or personal representative is responsible for accessing the account during probate and distributing the funds.

State laws and the presence of a will play a major role in this process.

What Happens If There Is No Beneficiary?

If a bank account does not have a named beneficiary and is not jointly owned, it typically becomes part of the deceased person’s estate. This means the account is subject to probate, the legal process for settling debts and distributing assets. Access to the funds may be restricted until a court appoints an executor or personal representative ⁵ .

Probate can slow down the transfer of money from a bank account with no beneficiary. The executor must follow court procedures before distributing assets, which can take several months or longer. During this time, the funds may only be used to pay estate expenses, debts or taxes.

If the deceased left a valid will, the will determines the distribution of the bank account after probate. Even so, the account must still go through the legal process because there is no beneficiary designation directing an automatic transfer. The will determines who ultimately receives the funds, but not how quickly.

When there is no beneficiary and no will, state intestacy laws determine who inherits the account. These laws typically prioritize spouses, children and close relatives, but the outcome may not reflect the deceased person’s preferences.

This situation can create delays and added stress for family members.

When Do Bank Accounts Go Through Probate?

Bank accounts typically go through probate when there is no mechanism to transfer ownership automatically upon death. This includes individually owned accounts that lack a payable-on-death or transfer-on-death beneficiary. Without a beneficiary designation, the account becomes part of the estate and goes through probate.

Accounts in one person’s name alone are more likely to go through probate, especially if there is no named beneficiary. In these cases, a court-appointed executor or personal representative must gain authority to access the funds. The money is then distributed in accordance with the will or state law, after debts and taxes are paid.

Probate may also be necessary if a beneficiary dies without a contingent beneficiary, or if the beneficiary designation is invalid or disputed. Similarly, conflicts among heirs or unclear account documentation can trigger probate even when some planning steps were taken. These situations can extend the timeline for settling the account.

Bank accounts with payable-on-death beneficiaries or joint accounts with rights of survivorship typically bypass probate. In these cases, the funds transfer directly to the surviving owner or named beneficiary.

This direct transfer is one of the main reasons estate planning professionals encourage regular reviews of account ownership.

How to Collect Assets If You’re the Beneficiary

If you are the named beneficiary of a bank account, the first step is to contact the financial institution and report the account holder’s death. Banks typically freeze the account temporarily until they receive proper documentation ⁶ . Starting this process early can help minimize delays in accessing the funds.

Most banks require a certified death certificate and a valid form of identification from the beneficiary. You may also need to complete claim forms or provide proof that you are the named beneficiary on the account. Requirements vary by institution, so confirming details directly with the bank is important.

Once the bank approves the claim, it will explain how the distribution of funds. In many cases, beneficiaries can receive the funds as a lump sum or transfer them to another account.

Knowing your options can help you decide how to manage your assets in a way that fits your financial needs.

Bottom Line

In most cases, whether a bank account goes through probate depends on its ownership and the naming of a beneficiary. Accounts with payable-on-death beneficiaries or joint owners typically transfer directly to the intended recipient, while accounts without these features often become part of the estate and must go through probate. Understanding these distinctions can help families avoid delays, legal costs and unnecessary stress during an already difficult time.

Estate Planning Tips

• A financial advisor can review account ownership and beneficiary designations to help identify where probate may apply and where adjustments may be needed. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
• While it may be tempting to save some money and plan your estate by yourself, you should still be careful with these DIY estate planning pitfalls.

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