We are having some difficulty determining when an estate account is needed. Two scenarios:

Joint account and one spouse passes away - a check is presented to us as: To the estate of John Doe. Can Jane Doe deposit this check into the joint account because it's the spouse? Or does an estate account need to be set up?

All other non-spouse joint accounts, one of the account holders passes away - a check is presented to us as: To the estate of John Doe. Can this check be deposited into the joint account? or does an estate account need to be set up?

As this is being argued within, I need actual cites as to what is the right way of doing things. Thanks for the help.

Sorry, but if you have a check payable to the "the estate of John Doe", regardless of any citation that someone might be able to come up with, why would anyone think that this check can be deposited into any account other than an estate account of John Doe???

I would be asking whoever is arguing that it is allowed to outline the legal argument that the bank will use when the legal hiers of John Doe approach the bank for the recovery of their funds.

I'm going to tag onto this question with another one. Is it the account to which it is being deposited with which we should be concerned or the authority of the depositor? By that I mean that we should ensure that the person cashing the check has the authority (i.e., personal representative papers) to act for the estate. After that, do we need to be concerned with the type of account to which it is deposited or does the personal representative retain liability?

I see that Randy has already opined on that one!

What if there is no actual estate set up for John Doe? We have found that under $50,000 an estate does not need to be created. Once again would there be a difference if married account holders or non-spouse account holders?

The fact that an estate is not create does not mean the bank should be involved in the negotiation of the check as you could be held liable by the beneficiaries of the estate's proceeds if you allow the check to be deposited into an account other than the estate.

In the absence of a formal estate, the party(s) to whom the funds are due should contact the maker of the check with the whatever documentation they require and ask that the check be reissued to those individual(s).

If the account was joint, it's not any longer. It belongs to the surviving owner, so there's no way the check payable to the estate can be deposited there. The answer is the same whether the owners were married or not, regardless of the check amount or the state's small estate exception.

Ironically, if the account had been owned only by the decedent and the check payable to his estate came in, it could theoretically be deposited to the account, because the account belongs to the estate.

What should happen to such a check? It should be returned for reissue or deposited to an estate account once the legal niceties of opening probate and appointment of the personal representative have been taken care of.