Joint Taxable Account

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3funder
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Joint Taxable Account

Post by 3funder » Wed Feb 21, 2018 9:09 pm

I have a taxable account in my name with Vanguard. My wife and I file our taxes jointly. Is there any reason for me not to make this a joint account?

PFInterest
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Re: Joint Taxable Account

Post by PFInterest » Wed Feb 21, 2018 9:21 pm

Are you going to leave her? And if it came from mixed money it's probably Co owned anyways.

Gill
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Re: Joint Taxable Account

Post by Gill » Wed Feb 21, 2018 9:23 pm

3funder wrote:
Wed Feb 21, 2018 9:09 pm
I have a taxable account in my name with Vanguard. My wife and I file our taxes jointly. Is there any reason for me not to make this a joint account?
I don’t see any reason to make it a joint account.
Gill

Gill
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Re: Joint Taxable Account

Post by Gill » Wed Feb 21, 2018 9:23 pm

PFInterest wrote:
Wed Feb 21, 2018 9:21 pm
Are you going to leave her? And if it came from mixed money it's probably Co owned anyways.
Not true in common law states.
Gill

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randomizer
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Re: Joint Taxable Account

Post by randomizer » Wed Feb 21, 2018 9:25 pm

If you made a trust account that could make things easier for the surviving spouse if one of you dies earlier.
75:25

123
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Re: Joint Taxable Account

Post by 123 » Wed Feb 21, 2018 10:41 pm

randomizer wrote:
Wed Feb 21, 2018 9:25 pm
If you made a trust account that could make things easier for the surviving spouse if one of you dies earlier.
Simultaneous deaths, while they do happen, are infrequent. Someone likely will pass away "earlier".
The closest helping hand is at the end of your own arm.

OnTrack
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Re: Joint Taxable Account

Post by OnTrack » Thu Feb 22, 2018 12:03 am

Two things come to mind.
- If one spouse is sued but not the other, then an account in only the name of the spouse not being sued would be off limits to the law suit.
- Possibly might be part of a strategy to minimize estate taxes depending on the potential sizes of each spouse's estate, the state of residence, who will inherit, etc.

OnTrack
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Re: Joint Taxable Account

Post by OnTrack » Thu Feb 22, 2018 12:19 am

Gill wrote:
Wed Feb 21, 2018 9:23 pm
PFInterest wrote:
Wed Feb 21, 2018 9:21 pm
Are you going to leave her? And if it came from mixed money it's probably Co owned anyways.
Not true in common law states.
Gill
What part is not true in common law states? I think PF means that if the account holds only money that belonged to the account holder before being married and if that money has never been commingled, then that money is not community property. That is true per:
http://family.findlaw.com/marriage/what ... at-in.html
"Any assets acquired before the marriage are considered separate property, and are owned only by that original owner."

Lafder
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Re: Joint Taxable Account

Post by Lafder » Thu Feb 22, 2018 12:31 am

At Vanguard they allow you to list POD or TOD on a single owned account. So if it stays in your name, you can list your wife as a primary beneficiary and others as secondary.

If you make it a joint account, there is no way to designate POD/TOD so it would have to go through a will and probate.

Either way, you can give your wife access.

I added my husband to my individual holdings after we had been together awhile.

If you keep it in your name, and get divorced, it could more possibly stay yours alone if you had it from before the marriage. If you add her name it becomes half hers.

lafder

3funder
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Re: Joint Taxable Account

Post by 3funder » Thu Feb 22, 2018 11:26 am

Thanks for your replies. A few points of clarification:

No plans to leave her.
Not worried about money-grubbing in the event of divorce; it's not her style, and she entered the marriage with more assets than I did.

Just wondering what folks would recommend doing if I don't have any specific concerns. If we wind up drawing up a trust, does it matter if it is a joint or individual account prior to doing so?

gowest
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Re: Joint Taxable Account

Post by gowest » Thu Feb 22, 2018 11:50 am

Lafder wrote:
Thu Feb 22, 2018 12:31 am
If you make it a joint account, there is no way to designate POD/TOD so it would have to go through a will and probate.
I don't think this is correct as between you and your spouse. If it's a joint account, and one of you passes away, the other one still owns the account with no meaningful paperwork involved. The joint account has (should have--perhaps call to confirm) a right of survivorship with it. If it's a joint account and both of you pass away at the same time, or if the surviving spouse passes away, then the account simply will be assets in your estate that your heirs get to deal with (through your will). (I'm assuming you have a will. If you don't have one, get one. And while I'm at it, also get a durable power of attorney, and healthcare power of attorney.)

WannabeBogleHead01
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Re: Joint Taxable Account

Post by WannabeBogleHead01 » Thu Feb 22, 2018 2:19 pm

Our joint taxable account at Vanguard is set up as JTWROS (Joint Tenancy With Rights of Survivorship.) As I understand it, we both have immediate access, if the other were to pass. It was set up years ago so may have changed, but doubtful. Others here will know more.

PFInterest
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Re: Joint Taxable Account

Post by PFInterest » Thu Feb 22, 2018 2:20 pm

Lafder wrote:
Thu Feb 22, 2018 12:31 am


If you make it a joint account, there is no way to designate POD/TOD so it would have to go through a will and probate.

this is definitely incorrect.

ChinchillaWhiplash
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Re: Joint Taxable Account

Post by ChinchillaWhiplash » Thu Feb 22, 2018 4:05 pm

You could just list her as the primary beneficiary.

sport
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Re: Joint Taxable Account

Post by sport » Thu Feb 22, 2018 4:22 pm

Before we married, our attorney recommended individual accounts instead of joint accounts. The only exception would be the checking account. His reason was protection of half of the assets in case of lawsuit. We now have separate trusts with each other as the secondary trustee and primary beneficiary. Of course, IRAs are always separate and are not in the trusts. We also have durable powers of attorney and have completed Vanguard's agency forms so we each have full access to everything.

gowest
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Re: Joint Taxable Account

Post by gowest » Thu Feb 22, 2018 4:23 pm

PFInterest wrote:
Thu Feb 22, 2018 2:20 pm
Lafder wrote:
Thu Feb 22, 2018 12:31 am


If you make it a joint account, there is no way to designate POD/TOD so it would have to go through a will and probate.

this is definitely incorrect.
Let me clarify. My point was simply that, as between OP and his/her spouse, for a joint account there is no designation, and no need to designate, since the account automatically stays with the surviving spouse. That's a reason to make it a joint account. Certainly if it's a joint account, and both spouses pass away, the account is dealt with through will(s)/probate.

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Pranav
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Re: Joint Taxable Account

Post by Pranav » Thu Feb 22, 2018 4:33 pm

Does Vanguard allow people to name beneficiaries for join taxable accounts (JTWROS)? During my brief search on their website, I couldn’t find an option to name beneficiaries for our joint taxable account at Vanguard.
https://www.bogleheads.org/wiki/Main_Page

delamer
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Re: Joint Taxable Account

Post by delamer » Thu Feb 22, 2018 4:38 pm

Considering cost basis if the OP dies first — how is the step up affected if the account is held by the OP only versus jointly?

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