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Committee advances bill to raise deceased-account withdrawal for funeral costs to $20,000
Summary
The House Judiciary Committee unanimously reported House Bill 167 to the floor; the bill would let close relatives withdraw up to $20,000 from a deceased person’s account to pay verified funeral expenses, up from $10,000, taking effect in 60 days.
The House Judiciary Committee on Wednesday unanimously advanced House Bill 167, which would let a financial institution release up to $20,000 to a close family member of a deceased person when the family shows a bill verifying funeral expenses have been paid.
The change would amend Title 20, Section 3101(b) to raise the existing $10,000 threshold, increase the priority order for dispute distribution (spouse, any child, a parent, then siblings), and take effect 60 days after enactment. Committee counsel described the measure as a way “to help families avoid the costly probate process when there are minimal assets in the estate.”
Representative Bonner, the bill’s sponsor, said the $10,000 limit set in 2013 is now “relatively low” and argued the increase reflects inflation and would reduce the need for families to pay roughly $1,500 in attorney and court costs to access small estates. “So this is a cost saving method, to release the funds to the family member as well,” Bonner said.
There were no amendments and no recorded negative votes. The committee clerk recorded the bill as reported to the floor as recommended.
The bill does not change tax treatment: counsel noted the withdrawn funds would not escape inheritance tax. The committee did not identify any additional implementation steps or required rule changes for financial institutions.
