ASK KIM Inheritance Rules for Joint Checking Accounts by Kimberly Lankford
I have gotten four different answers to this question: If you have a joint checking account and one person passes away, can the other person still write checks?
It depends on the type of joint ownership you have for the checking account. The transition is easiest if it's joint tenants with rights of survivorship. In most cases, you just need to give the bank a copy of the death certificate. Then the survivor becomes the sole owner of the account and can continue to write checks. "Ownership passes outside of probate immediately upon the death of the first joint tenant," says Jonathan Ellis, an estate-planning attorney in Jenkintown, Pa.
In fact, you may not even need to wait for the bank to process the change. With this type of ownership, each person owns 100% of the account and can write checks on their own anyway, says Mary Beth Navarro, a spokesperson for Wachovia.
The process can be a bit trickier if you had another type of joint ownership. With tenants in common, for example, each joint owner can leave his share of the account to whomever he wants instead of having it automatically pass to the other owner. The owners can specify in their wills who should inherit their portion of the account, which makes it subject to probate, says Ellis.
In that case, the survivor might have to wait a while before writing checks again. "In theory, half of the account was and remains the survivor's, but the bank or brokerage firm may freeze the account pending resolution," says estate-planning attorney Martin Shenkman, who runs the Laweasy.com Web site and wrote The Complete Living Trust Program. "In most states, there may be a need for tax clearance as well," to make sure any estate taxes have been paid.
The rules can vary by state and by the provisions of the account opening statement you received when you first set up the account, says Shenkman, so it's best to contact your bank to find out about the rules for your particular account.
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