Is POD the best designation for Mom’s checking account?

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Is POD the best designation for Mom’s checking account?

Post by One Ping » Sat Jun 08, 2019 2:17 pm

Background
My Mother is a recently widowed 91yo living in a CCRC with some early signs of dementia.

I have her POA and am currently listed as POA on her bank accounts. Because of this when my father died recently, I was able to handle all the transactions (legal and financial) quickly and cleanly for her.

I will be executor/personal representative (PR) for Mom's estate after her passing. I have siblings and Mom's will states that everything is to be evenly divided among us. Her estate will be simple (cash in bank accounts and small amount of personal property) and relatively small (couple $100k, max). Other than a checking account and a savings account, she has no other financial accounts of any kind. State of residence is Arizona, if it matters.

Since my POA for Mom dies when she dies, I'm wondering whether her bank accounts are set up properly for me, as her executor/PR, to have access to the funds in the checking account to pay her final expenses ... I fear not.

Her two bank accounts are:
Checking account: Post-death disposition > POD equally to all children
Savings account: Post-death disposition > POD equally to all children

Concern
My concern is that after her death I will not be able to pay final expenses/bills using her account(s). The POD designation effectively means all the money is distributed to the beneficiaries at the time of death and as such there will be $0 available in those accounts for the estate to use to pay her final expenses!

In theory, I could pay theses expenses from my personal account and bill the other siblings for their share of the expenses. However, for a number of reasons, I’d rather not do it that way. I’d rather pay them from her estate checking account and distribute the remainder after all the expenses have been paid. I believe it will be more straightforward that way.

Questions
1) Is my understanding of what happens to funds in POD accounts at death correct?

2) Would it make sense to have Mom (or can I alone, as POA?) remove the POD designation from the checking account (I would retain POA) and then keep an amount in that account sufficient to pay the expected final expenses (a few K$, at most)?

3) If 2) was done, I assume I would have access to funds in that account as soon as my executor/PR status was recognized by the bank, right?

4) How long (typically) does it take (after getting the death certificate) to be recognized as executor/PR and obtain the proper documents to gain access to the accounts to pay final expenses/bills?

Thanks for any and all help,
One Ping.
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Re: Is POD the best designation for Mom’s checking account?

Post by FIREchief » Sat Jun 08, 2019 2:42 pm

I think you're on the right track. I would keep ~$10K - $20K in the checking and remove the POD designation. IANAL, but I believe in AZ for less than $75K you can claim that $20K on behalf of the estate via signed affidavit (i.e. you would not need to use the probate process, and you would NOT petition the courts for letters of appointment). If I were you, I would talk to her bank and confirm that they will relinquish the funds upon receipt of such an affidavit. (Please see my signature)
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Re: Is POD the best designation for Mom’s checking accou

Post by Lexi » Sat Jun 08, 2019 2:44 pm

Some money should be left in the estate, not POD. Even with ideal sibling relationships you do not want each sibling to have to return money to cover these expenses. You also should assume that some expenses may need to be paid before you have official documentation as the executor, such as at least partial payment to the funeral home.
Some of the other expenses that should be covered by the estate include her pending bills from any source, medical bills, final CCRC bill, filing fees, final income tax bills, state/local taxes if any. Your out of pocket expenses as the executor are also allowable for payment.
POD is fine for amounts above what may be needed to cover costs but all cash should not be distributed until the expenses are paid.

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Re: Is POD the best designation for Mom’s checking account?

Post by HomeStretch » Sat Jun 08, 2019 2:51 pm

FIREchief wrote:
Sat Jun 08, 2019 2:42 pm
I think you're on the right track. I would keep ~$10K - $20K in the checking and remove the POD designation.
+1. Keep enough in the (non-POD) checking account to cover burial expenses and final bills.

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Re: Is POD the best designation for Mom’s checking account?

Post by dcdowden » Sat Jun 08, 2019 2:58 pm

After my Father passed away a couple years ago, I went in to the bank with my 91 year old Mother and we changed the title on her checking account so that it is now a joint account in both her and my names. We did this to insure that all of her automatically paid bills would continue to get paid after her eventual passing. I have one sister who will be co-executor when the time comes, but she lives out of state so from a practical standpoint I will deal with most of the immediate issues. My Mother still lives in a condo with full set of utility bills, assessments, etc that will keep going until we are able to sell the place. I have been an executor a couple other times, and my experience was that banks and brokerage firms freeze accounts on learning of an individual's passing. It took several weeks to get formal 'letters of office' from the Probate Court before I could access those accounts. In the mean time I had to pay bills out of my pocket. I even had to put the entire cost of a funeral on my Amex card. Of course on your Mother's passing, you will be the sole owner of the bank account and your siblings will have to trust that you use those funds for dealing with final expenses and then distribute the remainder per your Mother's wishes.

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Re: Is POD the best designation for Mom’s checking account?

Post by Mlm » Sat Jun 08, 2019 2:58 pm

HomeStretch wrote:
Sat Jun 08, 2019 2:51 pm
FIREchief wrote:
Sat Jun 08, 2019 2:42 pm
I think you're on the right track. I would keep ~$10K - $20K in the checking and remove the POD designation.
+1. Keep enough in the (non-POD) checking account to cover burial expenses and final bills.
Or she could add you to her checking account. That came in handy when my Mom was ill and after she passed for immediate expenses.

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Re: Is POD the best designation for Mom’s checking account?

Post by HomeStretch » Sat Jun 08, 2019 3:03 pm

Mlm wrote:
Sat Jun 08, 2019 2:58 pm
HomeStretch wrote:
Sat Jun 08, 2019 2:51 pm
FIREchief wrote:
Sat Jun 08, 2019 2:42 pm
I think you're on the right track. I would keep ~$10K - $20K in the checking and remove the POD designation.
+1. Keep enough in the (non-POD) checking account to cover burial expenses and final bills.
Or she could add you to her checking account. That came in handy when my Mom was ill and after she passed for immediate expenses.
Good point. My parents added me as a joint owner to their checking account as I pay their bills. Their bank will not add authorized signatories to personal accounts. Eventually, I will pay their final expenses from this account and share any excess equally with siblings.

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Re: Is POD the best designation for Mom’s checking account?

Post by FIREchief » Sat Jun 08, 2019 4:36 pm

I can appreciate the recommendations for the parent to add the adult child as a joint owner on a checking account provided:

a) the parent is willing to do this (I know of at least one situation where an elderly parent doesn't trust anybody for something like this, even a responsible adult child who does not need any money)
b) the siblings both trust the child being added and aren't the types to cause trouble
c) the child being added has strong credit and a strong marriage (or no marriage)

In all other situations, there may be better options. There may even be an option to prepay funeral/burial expenses, let everything pass via POD and then simply doing nothing else (i.e. nobody serves as personal representative).
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.

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Re: Is POD the best designation for Mom’s checking account?

Post by One Ping » Sat Jun 08, 2019 5:02 pm

Thanks, guys. Lots of good comments and ideas. Let me address them ...
FIREchief wrote:
Sat Jun 08, 2019 2:42 pm
I think you're on the right track. I would keep ~$10K - $20K in the checking and remove the POD designation.
HomeStretch wrote:
Sat Jun 08, 2019 2:51 pm
Keep enough in the (non-POD) checking account to cover burial expenses and final bills.
Lexi wrote:
Sat Jun 08, 2019 2:44 pm
POD is fine for amounts above what may be needed to cover costs but all cash should not be distributed until the expenses are paid.
This is exactly what I was thinking.
dcdowden wrote:
Sat Jun 08, 2019 2:58 pm
... [W]e changed the title on her checking account so that it is now a joint account in both her and my names. We did this to insure that all of her automatically paid bills would continue to get paid after her eventual passing.
Would the bank still keep the account open and honor those automatic payments after a joint account owner's death? I didn't think they did that.
Mlm wrote:
Sat Jun 08, 2019 2:58 pm
Or she could add you to her checking account. That came in handy when my Mom was ill and after she passed for immediate expenses.
HomeStretch wrote:
Sat Jun 08, 2019 3:03 pm
My parents added me as a joint owner to their checking account as I pay their bills. Their bank will not add authorized signatories to personal accounts. Eventually, I will pay their final expenses from this account and share any excess equally with siblings.
I seem to remember a thread here a while back saying that being a co-owner on a parent's account is not a good idea. Something about potentially opening up your other accounts to action by parent's creditors to address expenses owed by the parent, or vice-versa, should things 'go south.'
FIREchief wrote:
Sat Jun 08, 2019 4:36 pm
There may even be an option to prepay funeral/burial expenses, let everything pass via POD and then simply doing nothing else
Are you saying to ignore (i.e., not pay) other final expenses, like the last utility bills, last credit card bill, last 'rent' bill, etc. etc. etc. ?
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Re: Is POD the best designation for Mom’s checking account?

Post by CAsage » Sat Jun 08, 2019 5:05 pm

Another consideration is the amount of money generally held in the checking account. Yes, having you as Joint on that account will insure that the account isn't closed or frozen, and you can simply continue to pay Mom's bills from that. And then you don't have to open a new estate account or run the bills through your account. Having both accounts POD to multiple siblings sounds like a sure way to cause excess work and fuss - now someone will have to get reimbursed which might be an issue. If you are paying current rent and utilities, you need to keep the lights on for a month or so to clean everything out, plus all the final bills.... Personally, my sibling and I were completely in agreement that paying all Mom's final bills and closing out things properly was the way to go, not just drop the ball.
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Re: Is POD the best designation for Mom’s checking account?

Post by FIREchief » Sat Jun 08, 2019 5:32 pm

One Ping wrote:
Sat Jun 08, 2019 5:02 pm
FIREchief wrote:
Sat Jun 08, 2019 4:36 pm
There may even be an option to prepay funeral/burial expenses, let everything pass via POD and then simply doing nothing else
Are you saying to ignore (i.e., not pay) other final expenses, like the last utility bills, last credit card bill, last 'rent' bill, etc. etc. etc. ?
Absolutely not (my post likely wasn't clear enough). Those things you mentioned (last utility bill, last credit card, bill, etc.) are pretty minor things. The thought is that if the choices are a) a formal probate process with a court appointed executor with paid legal assistance or b) ignore all that, don't petition for letters of appointment and the POD beneficiaries just pay the final bills; then "b" might be a reasonable option. I've struggled to understand why more people in your situation don't just do this (it actually may happen a lot out there in non-Boglehead Land). If nobody is appointed executor, then is anybody legally responsible for tying up all the loose ends? (Morally? maybe/sure. Legally? I don't think so) At the end of the day, if the electric company and credit cards get their money, I'm not sure who would really care about much else. Even final tax returns may not be worth the bother if a person hasn't taken on a legal obligation to file them. I would like to hear more perspectives on this thought process. (please see my signature)
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Re: Is POD the best designation for Mom’s checking account?

Post by One Ping » Sat Jun 08, 2019 5:38 pm

Couple more questions :

1) Does joint ownership (JTWROS) allow the account to stay open and immediately accessible to the remaining owner after one of the owners has died?

2) Are there any issues with being a joint owner of an account while simultaneously being a POA for another joint owner.

3) If the surviving joint owner is also the executor/PR for the deceased owner, and is responsible for disposition of the residual estate (non-POD assets), does that create sort of legal jeopardy or conflict of interest?
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Re: Is POD the best designation for Mom’s checking account?

Post by One Ping » Sat Jun 08, 2019 5:43 pm

FIREchief wrote:
Sat Jun 08, 2019 5:32 pm
Those things you mentioned (last utility bill, last credit card, bill, etc.) are pretty minor things. The thought is that if the choices are a) a formal probate process with a court appointed executor with paid legal assistance or b) ignore all that, don't petition for letters of appointment and the POD beneficiaries just pay the final bills; then "b" might be a reasonable option. I've struggled to understand why more people in your situation don't just do this
Yes, b) is exactly what I would prefer to do. In fact, it is basically what we did when my Dad died a few months ago.

So, with joint ownership by Mom and me of the checking account, and POD on the savings account, it sound's like we (I) could execute your Plan B above fairly simply.
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Re: Is POD the best designation for Mom’s checking account?

Post by FIREchief » Sat Jun 08, 2019 5:52 pm

One Ping wrote:
Sat Jun 08, 2019 5:43 pm
FIREchief wrote:
Sat Jun 08, 2019 5:32 pm
Those things you mentioned (last utility bill, last credit card, bill, etc.) are pretty minor things. The thought is that if the choices are a) a formal probate process with a court appointed executor with paid legal assistance or b) ignore all that, don't petition for letters of appointment and the POD beneficiaries just pay the final bills; then "b" might be a reasonable option. I've struggled to understand why more people in your situation don't just do this
Yes, b) is exactly what I would prefer to do. In fact, it is basically what we did when my Dad died a few months ago.

So, with joint ownership by Mom and me of the checking account, and POD on the savings account, it sound's like we (I) could execute your Plan B above fairly simply.
I would think so but, as I've emphasized, I am not a lawyer or accountant. That said, I would certainly like to hear from those who are if there are any pitfalls in such an approach for a small/simple estate. I know enough about the personal representative role and probate process to conclude that I would never agree to serve as executor for anybody other than my spouse or adult child.
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Re: Is POD the best designation for Mom’s checking account?

Post by One Ping » Sat Jun 08, 2019 6:04 pm

Thanks, CAsage.
CAsage wrote:
Sat Jun 08, 2019 5:05 pm
Yes, having you as Joint on that account will insure that the account isn't closed or frozen, and you can simply continue to pay Mom's bills from that. And then you don't have to open a new estate account or run the bills through your account.
This is what I hope we can do.
CAsage wrote:
Sat Jun 08, 2019 5:05 pm
Having both accounts POD to multiple siblings sounds like a sure way to cause excess work and fuss - now someone will have to get reimbursed which might be an issue. If you are paying current rent and utilities, you need to keep the lights on for a month or so to clean everything out, plus all the final bills.... Personally, my sibling and I were completely in agreement that paying all Mom's final bills and closing out things properly was the way to go, not just drop the ball.
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Re: Is POD the best designation for Mom’s checking account?

Post by bayview » Sat Jun 08, 2019 9:54 pm

One Ping wrote:
Sat Jun 08, 2019 5:38 pm
Couple more questions :

1) Does joint ownership (JTWROS) allow the account to stay open and immediately accessible to the remaining owner after one of the owners has died?

2) Are there any issues with being a joint owner of an account while simultaneously being a POA for another joint owner.

3) If the surviving joint owner is also the executor/PR for the deceased owner, and is responsible for disposition of the residual estate (non-POD assets), does that create sort of legal jeopardy or conflict of interest?
So I have a similar scenario, and I have run it past bankers and brokers (attorney has a three-week wait):

I am a joint owner on my mother’s bank accounts, except one. (See below.) No need/role for POD/TOD, and I did not have to exercise FPOA. These will bypass probate and will not be restricted upon her death.

I am TOD on her brokerage accounts. On these, I have presented the paperwork for FPOA and jumped the hoops for their own version of FPOA. These will bypass probate. They will require a death certificate.

There is a recently-created MMA at one of her banks on which I’m not a joint owner or POD/TOD. (This was opened at about the time that she started having cognitive issues.) She has a revocable trust for all assets other than the jointly owned bank accounts and the TOD brokerage accounts, and that will be used to pay for her living costs, replenished as needed from the non-trust accounts. I will put the MMA funds in the trust account, plus the proceeds from her house sale etc. These funds will be used for final expenses.

It is certainly made simpler by her estate planning many years ago, plus the fact that I am the only child.

—people, if you haven’t started similar estate planning, get going. I can’t tell you how much more easily and smoothly things have gone over the last 2 1/2 months due to the thought she put into things 20 years ago. I have had my hands full simply ensuring optimal medical care, and the last thing that I needed to do was to worry and fuss about the lawn maintenance bill.
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Re: Is POD the best designation for Mom’s checking accou

Post by One Ping » Sun Jun 09, 2019 7:30 pm

Lexi wrote:
Sat Jun 08, 2019 2:44 pm
Some money should be left in the estate, not POD. ... You also should assume that some expenses may need to be paid before you have official documentation as the executor, such as at least partial payment to the funeral home.
Anyone know if the checking account was changed to my being a joint owner, would those funds be available to me, as a joint owner, after her death but before my executor/PR paperwork comes through?
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Re: Is POD the best designation for Mom’s checking accou

Post by bayview » Sun Jun 09, 2019 8:21 pm

One Ping wrote:
Sun Jun 09, 2019 7:30 pm
Lexi wrote:
Sat Jun 08, 2019 2:44 pm
Some money should be left in the estate, not POD. ... You also should assume that some expenses may need to be paid before you have official documentation as the executor, such as at least partial payment to the funeral home.
Anyone know if the checking account was changed to my being a joint owner, would those funds be available to me, as a joint owner, after her death but before my executor/PR paperwork comes through?
Yes

Edit: sorry, that’s if the account is outside of the trust. Pretty sure accounts with co-owners can’t be in an individual trust.
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Re: Is POD the best designation for Mom’s checking account?

Post by One Ping » Sun Jun 09, 2019 8:29 pm

bayview wrote:
Sun Jun 09, 2019 8:21 pm
One Ping wrote:
Sun Jun 09, 2019 7:30 pm
Lexi wrote:
Sat Jun 08, 2019 2:44 pm
Some money should be left in the estate, not POD. ... You also should assume that some expenses may need to be paid before you have official documentation as the executor, such as at least partial payment to the funeral home.
Anyone know if the checking account was changed to my being a joint owner, would those funds be available to me, as a joint owner, after her death but before my executor/PR paperwork comes through?
Yes

Edit: sorry, that’s if the account is outside of the trust. Pretty sure accounts with co-owners can’t be in an individual trust.
There is no trust, so we are good! :beer
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Re: Is POD the best designation for Mom’s checking account?

Post by bayview » Sun Jun 09, 2019 8:41 pm

One Ping wrote:
Sun Jun 09, 2019 8:29 pm
bayview wrote:
Sun Jun 09, 2019 8:21 pm
One Ping wrote:
Sun Jun 09, 2019 7:30 pm
Lexi wrote:
Sat Jun 08, 2019 2:44 pm
Some money should be left in the estate, not POD. ... You also should assume that some expenses may need to be paid before you have official documentation as the executor, such as at least partial payment to the funeral home.
Anyone know if the checking account was changed to my being a joint owner, would those funds be available to me, as a joint owner, after her death but before my executor/PR paperwork comes through?
Yes

Edit: sorry, that’s if the account is outside of the trust. Pretty sure accounts with co-owners can’t be in an individual trust.
There is no trust, so we are good! :beer
You should definitely confirm this with your banker, but this is what I was told by both of my mother’s banks.
The continuous execution of a sound strategy gives you the benefit of the strategy. That's what it's all about. --Rick Ferri

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Re: Is POD the best designation for Mom’s checking account?

Post by One Ping » Sun Jun 09, 2019 8:59 pm

bayview wrote:
Sun Jun 09, 2019 8:41 pm
One Ping wrote:
Sun Jun 09, 2019 8:29 pm
bayview wrote:
Sun Jun 09, 2019 8:21 pm
One Ping wrote:
Sun Jun 09, 2019 7:30 pm
Lexi wrote:
Sat Jun 08, 2019 2:44 pm
Some money should be left in the estate, not POD. ... You also should assume that some expenses may need to be paid before you have official documentation as the executor, such as at least partial payment to the funeral home.
Anyone know if the checking account was changed to my being a joint owner, would those funds be available to me, as a joint owner, after her death but before my executor/PR paperwork comes through?
Yes

Edit: sorry, that’s if the account is outside of the trust. Pretty sure accounts with co-owners can’t be in an individual trust.
There is no trust, so we are good! :beer
You should definitely confirm this with your banker, but this is what I was told by both of my mother’s banks.
:thumbsup
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Re: Is POD the best designation for Mom’s checking account?

Post by Katietsu » Sun Jun 09, 2019 10:10 pm

One Ping wrote:
Sun Jun 09, 2019 8:59 pm
bayview wrote:
Sun Jun 09, 2019 8:41 pm
One Ping wrote:
Sun Jun 09, 2019 8:29 pm
bayview wrote:
Sun Jun 09, 2019 8:21 pm
One Ping wrote:
Sun Jun 09, 2019 7:30 pm

Anyone know if the checking account was changed to my being a joint owner, would those funds be available to me, as a joint owner, after her death but before my executor/PR paperwork comes through?
Yes

Edit: sorry, that’s if the account is outside of the trust. Pretty sure accounts with co-owners can’t be in an individual trust.
There is no trust, so we are good! :beer
You should definitely confirm this with your banker, but this is what I was told by both of my mother’s banks.
:thumbsup
When the time comes, don’t tell the bank your mother has passed away, until you have already accessed the needed funds. There should not be a problem with a joint owner continuing to access the account.

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Re: Is POD the best designation for Mom’s checking account?

Post by Big Dog » Sun Jun 09, 2019 10:19 pm

Don't forget that under PoD/ToD, you won't receive the funds until after the death certificate is presented and that can be weeks. (Took ~6 weeks to recieve the death cert when my mom passed away in California.)

Suggest adding yourself as a signer to the checking account to pay final bills.

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Re: Is POD the best designation for Mom’s checking account?

Post by One Ping » Sun Jun 09, 2019 10:52 pm

Big Dog wrote:
Sun Jun 09, 2019 10:19 pm
Don't forget that under PoD/ToD, you won't receive the funds until after the death certificate is presented and that can be weeks. (Took ~6 weeks to recieve the death cert when my mom passed away in California.)
When my Dad died a few months ago it only took about 5-6 days to get the DC. (This was in AZ.) The hangup was the doc taking 3 or 4 days to sign it and get it to the funeral home. I did go in person to a county office and wait in line to pick it up though.
Big Dog wrote:
Sun Jun 09, 2019 10:19 pm
Suggest adding yourself as a signer to the checking account to pay final bills.
I have POA on the account now. I'm going to see if that will be good enough to add me as a joint owner and at the same time remove the POD designations for us 'kids'.
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Re: Is POD the best designation for Mom’s checking account? UPDATE

Post by One Ping » Tue Jun 11, 2019 8:12 pm

I talked to the bank today. Turns out my General Durable Power of Attorney is good for 'Personal Finances,' but what that really means is I can ...
... withdraw and deposit funds from bank accounts belonging to Principal and to enter and remove contents of all safe deposit boxes rented by the principal; ... ask, demand, sue for, recover, collect, and receive each and every sum of money, debt, account, legacy, bequest, interest, dividend, annuity and demand which is now or hereafter shall become due, owing or payable, belonging to or claimed by Principal and to use and take any lawful means for the recovery thereof by legal process or otherwise, and to execute and deliver a satisfaction or release therefor, together with the right and power to compromise or compound and claim or demand; to borrow money and to execute and deliver notes with or without security; and to loan money and receive notes with such security as Attorney-in-Fact shall deem proper.
... but not change ownership of account or change beneficiaries. :oops:

Looks like the next time I'm in AZ we will have to make a trip to the bank. :annoyed

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Re: Is POD the best designation for Mom’s checking account? UPDATE

Post by bayview » Tue Jun 11, 2019 9:45 pm

One Ping wrote:
Tue Jun 11, 2019 8:12 pm
I talked to the bank today. Turns out my General Durable Power of Attorney is good for 'Personal Finances,' but what that really means is I can ...
... withdraw and deposit funds from bank accounts belonging to Principal and to enter and remove contents of all safe deposit boxes rented by the principal; ... ask, demand, sue for, recover, collect, and receive each and every sum of money, debt, account, legacy, bequest, interest, dividend, annuity and demand which is now or hereafter shall become due, owing or payable, belonging to or claimed by Principal and to use and take any lawful means for the recovery thereof by legal process or otherwise, and to execute and deliver a satisfaction or release therefor, together with the right and power to compromise or compound and claim or demand; to borrow money and to execute and deliver notes with or without security; and to loan money and receive notes with such security as Attorney-in-Fact shall deem proper.
... but not change ownership of account or change beneficiaries. :oops:

Looks like the next time I'm in AZ we will have to make a trip to the bank. :annoyed

One Ping
Among all those clauses, are you allowed to open a new joint account? I can per my mother's trust. Which is handy, as I had to move her (it makes her sound like a piece of furniture) to another state, and neither of her banks have branches here.
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Re: Is POD the best designation for Mom’s checking account?

Post by ncbill » Wed Jun 12, 2019 6:34 am

I used a revocable living trust for mom after she was diagnosed with dementia, with myself as co-trustee (not successor)

Just did the same for another relative...moved their house and bank accounts into the trust.

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Re: Is POD the best designation for Mom’s checking account?

Post by bayview » Wed Jun 12, 2019 8:09 pm

ncbill wrote:
Wed Jun 12, 2019 6:34 am
I used a revocable living trust for mom after she was diagnosed with dementia, with myself as co-trustee (not successor)

Just did the same for another relative...moved their house and bank accounts into the trust.
How were you able to set up a trust in her name once she had a dementia diagnosis? I didn’t think that could be done.

I found a typo in my mom’s trust, and the attorney said it couldn’t be amended as her doctor had issued a certificate of incapacity. (I now have to carry around my marriage certificate as there is an error in my name in the trust.)
The continuous execution of a sound strategy gives you the benefit of the strategy. That's what it's all about. --Rick Ferri

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Re: Is POD the best designation for Mom’s checking account?

Post by donall » Thu Jun 13, 2019 9:44 am

POA ends at death. If you have a joint account with your mom that works well for paying immediate bills and automated deposits and payments. You should open a checking account for the estate or trust using a new EIN. This account is useful for refunds (health insurance premiums, utilities, deposits, etc.) as well as paying other bills, and for distributions to heirs. Tax forms need to be filed for both the individual and estate/trust in the year of death.

Bayview, sorry to hear that your name was misspelled in your mom’s trust. I was lucky enough to be asked to review my parent’s trust ten years after they were written. Numerous mistakes including the spelling of my name. Changes were made to the original trust and will through a codicil and amendment, since properties and accounts were titled with original documents. This made the documents more complex and more pages. Of course this also cost extra money! So please check your documents before they are signed.

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Re: Is POD the best designation for Mom’s checking account?

Post by One Ping » Thu Jun 13, 2019 10:42 am

Thank, donall.
donall wrote:
Thu Jun 13, 2019 9:44 am
Tax forms need to be filed for both the individual and estate/trust in the year of death.
Is this true even if, had she lived, she would not have been required to file for the year?
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Re: Is POD the best designation for Mom’s checking account? UPDATE

Post by One Ping » Thu Jun 13, 2019 10:57 am

bayview wrote:
Tue Jun 11, 2019 9:45 pm
One Ping wrote:
Tue Jun 11, 2019 8:12 pm
I talked to the bank today. Turns out my General Durable Power of Attorney is good for 'Personal Finances,' but what that really means is I can ...
... withdraw and deposit funds from bank accounts belonging to Principal and to enter and remove contents of all safe deposit boxes rented by the principal; ... ask, demand, sue for, recover, collect, and receive each and every sum of money, debt, account, legacy, bequest, interest, dividend, annuity and demand which is now or hereafter shall become due, owing or payable, belonging to or claimed by Principal and to use and take any lawful means for the recovery thereof by legal process or otherwise, and to execute and deliver a satisfaction or release therefor, together with the right and power to compromise or compound and claim or demand; to borrow money and to execute and deliver notes with or without security; and to loan money and receive notes with such security as Attorney-in-Fact shall deem proper.
... but not change ownership of account or change beneficiaries. :oops:

Looks like the next time I'm in AZ we will have to make a trip to the bank. :annoyed

One Ping
Among all those clauses, are you allowed to open a new joint account?
Good question.

I imagine I could open a totally separate, unrelated checking account, under my own name, add her as a joint owner and then, using my POA, transfer her checking account funds to that new joint checking account. I'd also have to have her SS direct deposit changed to that new, joint, checking account. Dunno if that might be a problem for SSA or not?

Also, I'm not sure how complex moving funds from her current savings account to that new, joint checking account might be.
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Re: Is POD the best designation for Mom’s checking account?

Post by JGoneRiding » Thu Jun 13, 2019 11:23 am

I have expressed several time that this is a concern and people tend to ignore it!

I have recently completed probate training for state of Oregon. They said intent matters so technically they should pay final expenses but reality matters more and the banks do not care about intent they will split evenly and you would need to submit claims ie small claims court if your siblings will not voluntarily pay their share.

Ianal. But my suggestion is to have a third account that either only goes to you with a written statement that this money is specifically for final expenses and it is your mothers wish that any extra be split. Or to have a small amount that will be probated. Most states have a simple propate for small estate.

Again ianal but that money in the accounts despite pod is NOT the heirs first it's still the estates first and all creditors have a right to ask for it and in .most states the right to open probate themselves. Of course most won't bother for a small sum. However if they do they will simply request judgment against all and really do not care which heir pays up.

I believe Bsteiner has posted several times about going after heirs for their share of costs

Edit: ?4 it took 6 weeks and a probate filing fee to get my letters of testimantory starting I was PR. Oregon is slow though

Edit 2: my aunt had almost every single bill set for autopay. Despite having notified the bank and given them a DC every single one of those went through for 2 months worth! Dealing with them was fascinating differences. For example net flix and the NYT we simple canceled online as of we were her. Comcast insisted on signed statements, documents etc but then gave us full credit back to DOD which was surprising and helpful but also annoying getting done. Most other utilities were fine with just a phone call and either stopped service or transfer to estate account.

Fyi you can't do anything electronic for estate accounts! All old school! For Oregon at least I am not even allowed to have an atm card
Last edited by JGoneRiding on Thu Jun 13, 2019 11:34 am, edited 1 time in total.

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Re: Is POD the best designation for Mom’s checking account?

Post by whomever » Thu Jun 13, 2019 11:26 am

What we did, FWIW: the last surviving parent had given up driving etc, so the only assets of note were the house and bank/brokerage accounts. We opened a joint checking account for all the kids+parent. That was paying the parents bills before death. Sometimes the parent would contribute to it, but sometimes forgot, and then the siblings would each contribute an equal amount when needed.

The house and all the other assets were TOD/POD. We didn't even have to open an estate (the will named the kids as executors if we had wanted to open one). We just kept the multi-way checking account open to pay final expenses. When the dust all eventually settled the kids just divided the remaining funds in the joint checking account.

This only works if all the kids (and parents) are on good terms; we were. Not having to open an estate saved quite a bit (the state in question required adding a local executor (all the kids were out of state)). The only downside was that we got one small refund, from a utility IIRC, that was in the parent's name, and couldn't cash that w/o opening an estate. But that was for $75 or somesuch - much less than the expense of opening an estate.

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Re: Is POD the best designation for Mom’s checking account?

Post by ncbill » Thu Jun 13, 2019 11:30 am

bayview wrote:
Wed Jun 12, 2019 8:09 pm
ncbill wrote:
Wed Jun 12, 2019 6:34 am
I used a revocable living trust for mom after she was diagnosed with dementia, with myself as co-trustee (not successor)

Just did the same for another relative...moved their house and bank accounts into the trust.
How were you able to set up a trust in her name once she had a dementia diagnosis? I didn’t think that could be done.

I found a typo in my mom’s trust, and the attorney said it couldn’t be amended as her doctor had issued a certificate of incapacity. (I now have to carry around my marriage certificate as there is an error in my name in the trust.)
A diagnosis of dementia is not a legal determination of incapacity.

As a practical matter, it's the attorney that makes the call as to whether they understand sufficiently to setup a trust or execute any other legal matters.

The main point of a trust in the above situation to authorize an agent (trustee) to handle their financial affairs before they become incapacitated.

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Re: Is POD the best designation for Mom’s checking account?

Post by dm200 » Thu Jun 13, 2019 1:05 pm

ncbill wrote:
Thu Jun 13, 2019 11:30 am
bayview wrote:
Wed Jun 12, 2019 8:09 pm
ncbill wrote:
Wed Jun 12, 2019 6:34 am
I used a revocable living trust for mom after she was diagnosed with dementia, with myself as co-trustee (not successor)
Just did the same for another relative...moved their house and bank accounts into the trust.
How were you able to set up a trust in her name once she had a dementia diagnosis? I didn’t think that could be done.

I found a typo in my mom’s trust, and the attorney said it couldn’t be amended as her doctor had issued a certificate of incapacity. (I now have to carry around my marriage certificate as there is an error in my name in the trust.)
A diagnosis of dementia is not a legal determination of incapacity.

As a practical matter, it's the attorney that makes the call as to whether they understand sufficiently to setup a trust or execute any other legal matters.


The main point of a trust in the above situation to authorize an agent (trustee) to handle their financial affairs before they become incapacitated.
No experience or expertise, but from what our estate attorney regularly told folks - the standard for "incapacity" in such situations is quite "liberal". Find an experienced attorney that does this all the time and is familiar with the details in your state.

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Re: Is POD the best designation for Mom’s checking account?

Post by One Ping » Thu Jun 13, 2019 1:34 pm

dm200 wrote:
Thu Jun 13, 2019 1:05 pm
No experience or expertise, but from what our estate attorney regularly told folks - the standard for "incapacity" in such situations is quite "liberal". Find an experienced attorney that does this all the time and is familiar with the details in your state.
:?: Does this mean it's easy to get someone declared incapacitated ... or is it hard?
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Re: Is POD the best designation for Mom’s checking account?

Post by bayview » Thu Jun 13, 2019 1:44 pm

dm200 wrote:
Thu Jun 13, 2019 1:05 pm
ncbill wrote:
Thu Jun 13, 2019 11:30 am
bayview wrote:
Wed Jun 12, 2019 8:09 pm
ncbill wrote:
Wed Jun 12, 2019 6:34 am
I used a revocable living trust for mom after she was diagnosed with dementia, with myself as co-trustee (not successor)
Just did the same for another relative...moved their house and bank accounts into the trust.
How were you able to set up a trust in her name once she had a dementia diagnosis? I didn’t think that could be done.

I found a typo in my mom’s trust, and the attorney said it couldn’t be amended as her doctor had issued a certificate of incapacity. (I now have to carry around my marriage certificate as there is an error in my name in the trust.)
A diagnosis of dementia is not a legal determination of incapacity.

As a practical matter, it's the attorney that makes the call as to whether they understand sufficiently to setup a trust or execute any other legal matters.


The main point of a trust in the above situation to authorize an agent (trustee) to handle their financial affairs before they become incapacitated.
No experience or expertise, but from what our estate attorney regularly told folks - the standard for "incapacity" in such situations is quite "liberal". Find an experienced attorney that does this all the time and is familiar with the details in your state.
Her physician issued the declaration of incapacity. (Certificate? Declaration? don't have it with me at the moment.) Per the trust, it only took one physician (some require two.) It's not just the presence of the diagnosis; it's the fact that he had treated her, and in his professional judgment, she is unable to legally enter a contract due to severe short-term memory damage. And I agree.

Once the attorney knew that that had happened, he wouldn't touch it. It's not the end of the world, although I'm a bit irked because I had asked him about editing the trust (before she went rapidly downhill after an injury), and per his paralegal he said that having the error wouldn't be a big deal. Easy for him to say.
The continuous execution of a sound strategy gives you the benefit of the strategy. That's what it's all about. --Rick Ferri

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Re: Is POD the best designation for Mom’s checking account?

Post by dm200 » Thu Jun 13, 2019 2:00 pm

One Ping wrote:
Thu Jun 13, 2019 1:34 pm
dm200 wrote:
Thu Jun 13, 2019 1:05 pm
No experience or expertise, but from what our estate attorney regularly told folks - the standard for "incapacity" in such situations is quite "liberal". Find an experienced attorney that does this all the time and is familiar with the details in your state.
:?: Does this mean it's easy to get someone declared incapacitated ... or is it hard?
Don't know. I just understand that there are multiple aspects to the matter.

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Re: Is POD the best designation for Mom’s checking account?

Post by ncbill » Thu Jun 13, 2019 4:05 pm

dm200 wrote:
Thu Jun 13, 2019 1:05 pm
ncbill wrote:
Thu Jun 13, 2019 11:30 am
bayview wrote:
Wed Jun 12, 2019 8:09 pm
ncbill wrote:
Wed Jun 12, 2019 6:34 am
I used a revocable living trust for mom after she was diagnosed with dementia, with myself as co-trustee (not successor)
Just did the same for another relative...moved their house and bank accounts into the trust.
How were you able to set up a trust in her name once she had a dementia diagnosis? I didn’t think that could be done.

I found a typo in my mom’s trust, and the attorney said it couldn’t be amended as her doctor had issued a certificate of incapacity. (I now have to carry around my marriage certificate as there is an error in my name in the trust.)
A diagnosis of dementia is not a legal determination of incapacity.

As a practical matter, it's the attorney that makes the call as to whether they understand sufficiently to setup a trust or execute any other legal matters.


The main point of a trust in the above situation to authorize an agent (trustee) to handle their financial affairs before they become incapacitated.
No experience or expertise, but from what our estate attorney regularly told folks - the standard for "incapacity" in such situations is quite "liberal". Find an experienced attorney that does this all the time and is familiar with the details in your state.
Sure, state laws may differ.

I'm sure the elder law attorney they used knew exactly what they were doing in accordance with our state laws.

The whole point of using a trust is to avoid the need for any court proceedings, e.g. conservatorship or full guardianship.

And to avoid the "will they or won't they accept a POA?" issues with financial institutions.

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