When a loved one passes away in the United States, heirs abroad often face unexpected challenges when it comes to accessing bank accounts and other financial assets. Unlike some countries in Europe where assets may transfer automatically, the U.S. probate and banking systems impose strict requirements to protect against fraud and ensure compliance with both state and federal laws. For foreign heirs, this process can feel overwhelming, but with the right legal guidance it is manageable.
Why Access Can Be Complicated
Banks in the U.S. cannot simply release funds to someone claiming to be an heir. In most cases, the account holder’s estate must go through probate, the court-supervised process of validating a will, appointing an executor (personal representative), and settling debts before distributions are made. If there is no U.S. executor or attorney involved, banks may freeze accounts indefinitely. Foreign heirs often encounter delays because they are unfamiliar with local rules or cannot appear in person to sign required documents.
Probate vs. Non-Probate Accounts
Not all bank accounts are treated equally.
- Joint accounts with rights of survivorship typically pass directly to the surviving account holder, bypassing probate.
- Accounts with designated beneficiaries (such as “payable on death” accounts) also transfer directly to the named person.
- Individual accounts without a beneficiary almost always require probate, meaning foreign heirs must wait until the estate is administered.
Understanding which category the account falls into is the first step in determining how quickly funds can be accessed.
Documentation Typically Required
Foreign heirs will usually need to provide:
- A certified copy of the death certificate
- Court-issued probate documents (letters testamentary or letters of administration)
- Proof of identity and sometimes proof of relationship to the deceased
- Tax identification information (U.S. or foreign), since banks must report certain transfers to the IRS
Without the proper paperwork, U.S. banks will not release funds, regardless of an heir’s entitlement under foreign law.
Taxes and Reporting
One of the most confusing aspects for foreign heirs involves U.S. taxes.
- No federal inheritance tax: At the federal level, heirs do not pay a tax simply for receiving an inheritance.
- Estate tax may apply: The U.S. does impose a federal estate tax on large estates before assets are distributed. For 2025, the federal estate tax exemption is $13,990,000 per individual, meaning that the vast majority of estates fall below the threshold. However, amounts above this exemption may be taxed up to 40%.
- State-level taxes: While many U.S. states do not impose inheritance or estate taxes, some (such as Pennsylvania, Nebraska, Kentucky, Iowa, Maryland, and New Jersey) do levy additional taxes. These rules can significantly affect beneficiaries depending on where the deceased lived.
In addition, heirs abroad may have reporting obligations in their home countries. Transfers over certain thresholds must also be reported to the IRS, even when the heir is not a U.S. resident. For Europeans, double taxation treaties between the U.S. and their home countries (such as Germany or France) can help reduce exposure, but navigating these agreements requires careful planning.
How we can help
Working with a law firm experienced in both U.S. probate and international inheritance law can significantly simplify the process. Attorneys can act as representatives before the probate court, communicate with banks, prepare necessary translations, and ensure compliance with both U.S. and foreign tax laws. For heirs living overseas, this support can prevent unnecessary travel, reduce delays, and avoid costly mistakes.
Accessing a U.S. bank account as a foreign heir is rarely as simple as showing proof of relationship. Understanding whether probate applies, gathering the right documents, and complying with U.S. tax and reporting rules are all essential steps. With Urban, Thier & Federer’s help, heirs abroad can navigate these challenges and ensure that their loved one’s assets are transferred efficiently and lawfully.