When a loved one dies, immediate access to bank accounts is often a concern. Many assume a spouse or child can withdraw funds right away, but Michigan law does not always allow this. Access depends on account titling and prior estate planning. We advise clients in Oakland and Macomb Counties, and Southeast Michigan area, that account structure determines post-death access.
Michigan probate law is governed by the Estates and Protected Individuals Code, commonly referred to as EPIC, codified at MCL 700.1101. Bank account ownership and transfers at death are also addressed in Part 6 of EPIC, including MCL 700.6101, which governs non-probate transfers on death. Understanding these statutes is critical to determining who has authority to access funds and when.
Individual Accounts Without A Beneficiary
If a bank account is titled solely in the decedent’s name and does not include a payable on death designation, the account generally becomes part of the probate estate. Under MCL 700.1302, the probate court has exclusive legal and equitable jurisdiction over matters relating to decedents’ estates.
In this situation, no family member automatically gains access. A personal representative must be appointed by the probate court under MCL 700.3203. Once appointed, the personal representative receives letters of authority and may collect and manage estate assets under MCL 700.3709. Until that appointment occurs, the bank typically will not release funds.
Joint Accounts With Rights Of Survivorship
Many married couples and family members hold joint bank accounts. Under MCL 487.703, financial institutions may treat joint accounts with rights of survivorship as belonging to the surviving account holder upon the death of the other owner. In these cases, the surviving joint owner usually has immediate access to the funds without probate.
Disputes may arise if survivorship intent is unclear. The account agreement and bank records govern. Clear titling helps prevent conflicts among heirs.
Payable On Death And Transfer On Death Designations
Michigan law allows individuals to name beneficiaries on accounts. Under Michigan law, a transfer on death designation allows assets to pass directly to a named beneficiary outside probate.
If a payable-on-death beneficiary is properly designated, the bank may release funds to that beneficiary upon proof of death and identification. The account bypasses probate, allowing faster access to funds for funeral or immediate expenses.
Powers Of Attorney And Death
A common misunderstanding involves powers of attorney. Under the Michigan Uniform Power of Attorney Act, MCL 556.210, an agent’s authority terminates upon the principal’s death. This means a family member acting under a valid power of attorney loses authority to access bank accounts once death occurs.
After death, only a court-appointed personal representative or surviving joint owner may act. Using a power of attorney after death is not permitted.
Small Estates And Limited Procedures
Michigan provides simplified procedures for certain small estates. Under MCL 700.3982, if the estate is below a statutory threshold and does not include real property, heirs may use an affidavit procedure to collect assets without formal probate. This may allow access to bank accounts in limited circumstances.
Even for small estates, strict compliance with statutory requirements is necessary. Financial institutions require documentation before releasing funds.
Planning Ahead To Avoid Delays
Proper estate planning reduces delays and confusion. Coordinating beneficiary designations, joint ownership, and wills ensures accounts transfer as intended. Without clear planning, families may face probate and limited access to funds during a difficult time.
We help clients in Southeast Michigan structure accounts and estate plans to reflect their goals and comply with Michigan law.
Frequently Asked Questions
If the account was solely in the decedent’s name without a beneficiary designation, the surviving spouse does not automatically have access. Probate proceedings are typically required, and a personal representative must be appointed under MCL 700.3203 before funds are released.
Generally, a joint account with rights of survivorship passes directly to the surviving owner under MCL 487.703. However, the account agreement must clearly establish survivorship rights. Disputes can arise if documentation is unclear or contested.
Under MCL 556.210 of the Michigan Uniform Power of Attorney Act, an agent’s authority terminates upon the principal’s death. After death, only a court-appointed personal representative or a surviving joint owner may act regarding bank accounts.
Under MCL 700.6101 et seq., a payable on death designation allows funds to transfer directly to a named beneficiary outside probate. The bank will require proof of death and identification before releasing funds.
Yes, under MCL 700.3982, certain small estates may use an affidavit procedure if statutory conditions are met. This process may allow the collection of bank funds without formal probate administration.
Contact Boroja, Bernier & Associates For Your Consultation
Understanding how bank accounts transfer after death helps prevent uncertainty and delays. Boroja, Bernier & Associates assists clients in Oakland, Macomb, Wayne, and the greater Southeast Michigan counties with estate planning and probate.
To schedule a consultation with the Michigan estate planning attorneys at Boroja, Bernier & Associates, by calling our law offices at (586) 991-7611. Our offices throughout Southeast Michigan with our main office in Shelby Township serve clients throughout Oakland County, Macomb County, and Southeast Michigan.
