If you’re like most people, you’ve started thinking about what will happen after your passing. You may wonder what steps you can take to help protect your loved ones and your property. While you may have a Will in place, it’s important to familiarize yourself with Payable-On-Death Accounts and their benefits. If this reflects your circumstances, the following blog explores what you should know about these complex matters, including the importance of discussing your circumstances with a Medina, Ohio estate planning lawyer to explore your options.
How Do Payable-On-Death Accounts Work in Ohio?
A Payable-On-Death (POD) account allows you to establish a Beneficiary Designation for the account. This means that, upon your passing, ownership of the account will automatically transfer to the named Beneficiary. Over the course of your life, however, you will
In order for the Beneficiary to gain control of the funds in this account, they’ll need to contact the bank or financial institution where the account is held and provide your death certificate. Once validated, the bank will release the funds directly to the named Beneficiary.
What Are the Benefits of This Option?
One of the primary reasons that people establish payable on death accounts is that they bypass the Probate process. When someone dies, their estate undergoes Probate, which can be a long, tedious, and expensive process. This is because the Probate court must validate the Will and oversee the distribution of assets in accordance with the terms and conditions of the Will. As such, many people utilize Trust Funds and other estate planning tools to bypass this process.
Establishing a Payable-On-Death Account does bypass this process, as it is also referred to as a Totten Trust. As such, this account will not be subject to Probate because it is automatically transferred to the Beneficiaries upon your passing. The account will not be considered part of your Probate estate, so your Beneficiaries will receive immediate access to the funds.
It is important to note, however, that if a named Beneficiary passes away before you and you do not have a Contingent Beneficiary named, or the Designation is not properly recorded, Probate may be necessary.
How Do I Set Up This Kind of Account?
If you are interested in creating a Payable-On-Death Account, you’ll need to contact your bank or financial institution to request a Beneficiary Designation Form. You’ll then need to complete the form, making sure to put your intended Beneficiary’s full name, Social Security number, and mailing address.
Creating an estate plan can be incredibly stressful in Ohio, which is why it’s critical to connect with an experienced attorney at Krause Law. Our team knows that there are many important considerations you’ll need to make during this process, so we are here to help. We can work with you to plan an estate that offers you the peace of mind necessary for the future. Contact us today to learn more.
