There are two (2) ways to close a Pennsylvania estate. First, the executor or administrator can prepare a Family Settlement Agreement. A Family Settlement Agreement is often the easiest way to close an estate in PA because it does not involve any judicial proceedings. If all of the heirs and administrators of the estate agree, a contract can be prepared detailing all of the distributions and payments that have been made.
A Family Settlement Agreement binds all of the parties who sign it. It is important to consider that although a Family Settlement Agreement is a legally binding contract, it does not necessarily prevent parties from pursuing additional claims against an estate.
Your Family Settlement Agreement should provide for the recovery, on a pro rata basis, of distributions paid to the beneficiaries if they are needed to satisfy a future claim from a creditor. Potential creditors to a PA estate include the PA Department of Revenue and the IRS. It is extremely important to have a Pennsylvania Family Settlement Agreement prepared by an experienced PA probate lawyer.
The second way to close an estate in PA is to file an accounting with the local county Orphans’ Court. The executor or administrator must file a legal breakdown of the estate assets and expenses. The accounting is accompanied by a request for an audit date. If any objections to the accounting are properly filed, the Orphans’ Court judge will set a date to hear the objections.
If there are no objections, then the executor or administrator is given permission to file a Petition for Adjudication. The Petition for Adjudication requests the right to make all distributions and to pay all of the remaining bills. Once the judge approves the Petition for Adjudication, distributions and payments can be made.