My Experience as a Beneficiary Claiming POD Bank CDs

me1004 - #1, Monday, November 28, 2011 - 10:36 AM

Very interesting to note the loss of FDIC coverage 6 months after the death.

I note, when I did this a few years ago after my father died, I learned that I, as beneficiary, was the trust executor. I had always thought the banks were the executor, and I was merely the receiving beneficiary. But as such, I am VERY alarmed that PNC converted your CDs without ever even hearing from you. Yes, your brother had informed them of the death. Still, as I understand it, they had no legal authority to do anything with the accounts on which you were beneficiary -- I believe only the executor has power to do that -- unless perhaps it was part of the terms of the CD that it would automatically close upon death, but I've never seen such terms.

Come to  think of it, I'm not sure I've seen anything of disclosures about what happens to a POD upon death. If the bank wants to apply rules, such as whether you MUST close it, I would think that would have to be specified in disclosures up front upon opening the POD.

In my case, I was dealing with a CD at Hudson City Bank in New Jersey. I was there, and just wanted to close it while there. But I learned that if I closed the CD before the interest was posted, I would lose all accrued interest that had not yet been posted. It was posted quarterly, so I waited until the end of the quarter and then closed immediately, and they mailed me the check. If they had had a rule that it must close upon death, that I had no choice to let it ride, then I would have lost all accrued interest! Even worse if they had taken it upon themselves to close it before I even had a chance to get in touch wiht them (my brother had given them a copy of the death certificate before I was even informed of the CD, so there are always circumstances why they might know of a death yet the beneficiary could not yet have been in touch with them).

Anonymous - #2, Monday, November 28, 2011 - 11:07 AM

I think me1004 (comment #1) is misinterpreting the FDIC provision: "The FDIC insures a deceased person’s accounts as if the person were still alive for six months after the death of the account holder."

This does not mean that FDIC coverage ends 6 months after death - the only thing that changes after 6 months is the method of calculating the total amount of FDIC coverage available.  So if the beneficiary had other accounts (in the same ownership class) at the same bank, then the FDIC would only provide insurance up to the limit for that beneficiary alone after 6 months had passed; for the first 6 months, there would be an increased insurance limit, calculated as if the account holder were still alive.

If the beneficiary had no other accounts (in the same ownership class) at the same bank, or if the combined total of existing accounts and inherited accounts were below the FDIC coverage limit, then all funds would continue to be insured by the FDIC regardless of whether the account has been claimed.

 

me1004 - #3, Monday, November 28, 2011 - 3:51 PM

Oh, is that what they were saying? Wasn't clear immediately without more specific language. They should say it as clearly as you did. 

BTW, I wasn't misrepresenting. I merely misunderstood.

Living Trustee (anonymous) - #5, Monday, November 28, 2011 - 6:15 PM

Excellent column!  Passing this around to all my friends.  Thanks! 

A related note: My folks put all their accounts (a big bunch of CD's) and other assets into a family trust, and I was the Managing Trustee.  Hence, all of their bank accounts were titled under their trust, so no POD's (the trust was filed with each account and showed the beneficiaries, and the FDIC treats that beneficiary page like a POD page). Upon my second parent's death I set up a special liquidation account and, upon presentation of the death certificates and my trustee certificate to each bank, I received checks payable to the temporary liquidation trust acccount that I set up (I then paid the pooled cash out to the trust's beneficiaries from that one account). 

In that regard, I delayed a 5-year, 6.00% APY CD's liquidation until the very end of my trust-liquidation duty.  All went smooth with all banks, and the FDIC coverage during the acccounts' existence was tied to the number of beneficiaries in the trust.  BUT, this was an "A-B" trust, so if one parent dies first his share becomes "A-trust" and "irrevocable,"  while the surviving parent's share (B trust) remained revocable.  The pitfall: FDIC coverage on an irrevocable trust was reduced to just one-beneficiary level (i.e., as if there was only one beneficiary on the account, even if there were multiple trust beneficiaries shown on the trust document filed with every bank). 

Still, when IndyMac failed (I managed the cash by CD-investing in weak, high-pay banks), the FDIC didn't seem to notice that it was an irrevocable trust account and my marginal, over-limit portion was safe (I got 100% of the account paid out).

POD's are wonderful; I have them on all my accounts.  They are obviated, however, by the use of a living trust. So when you see a POD, that often means that the owner is using a will, rather than a trust.  A will is more expensive to administer at death than a living trust.  But simple estates like mine (CD's with POD's, a few assets, no spouse or child support) can get away with POD's and a will.  Those with more complex estates -- look into a living trust, and remember that POD's won't work if the CD's and other bank accounts are placed in the trust (because the trust's beneficiary page controls).

Anonymous - #6, Monday, November 28, 2011 - 8:00 PM

Very interesting information. I just have been looking into the best way to set up CD's when my relatives live overseas and will not be able (or willing) to come to claim the CD personally at the bank if I use POD designation. Can anyone give me any advice. I would greatly appreciate it.

lou - #7, Monday, November 28, 2011 - 9:55 PM

Poster #2  I am confused by your explanation. I think you are saying the $250,000 insurance for a beneficiary would continue beyond the 6 months even if the account owner has died. However, if you were a beneficiary for another account owner at the same bank, the $500,000 of insurance you had as a beneficiary for both accounts would now be reduced to $250,000 after 6 months of the death of one of the account owners. Is this correct? Assuming I am understanding this correctly, this could be a problem if there is $500,000 in both accounts. After 6 months, $250,000 of the funds  would be uninsured if I  did not close the accounts.

Future Living Trustee (anonymous) - #8, Tuesday, November 29, 2011 - 5:40 PM

Question to "Living Trustee" (post #5) and others:  

I am pondering setting up a living trust.

My understanding is that it will eventually be up to any candidate financial institution to review my trust document to decide whether it will be bound by its conditions before it will agree to open a trust account and re-title my assets into the trust.

One key condition for me would be that my trust document stipulates that any term deposits can only be held in institutions that allow redemption and/or transfer of title prior to maturity upon the triggering event of my death.  The idea here is to explitcitly ensure that my trust is only involved with financial institutions that agree to allow my trust to be wound up promptly.  (Otherwise there is a worst case scenario:  suppose trust termination is delayed for years pending maturation of locked-in CDs, then consider the annual fees if a backup corporate trustee comes into play.)  

My question is:  how specific can my trust document be without spooking the candidate financial institutions?

E.g. can I safely elaborate in the following manner? :

“… for term deposit assets, the trustee can only use institutions that allow term deposits to be converted prior to maturity upon the triggering event of the settlor's death in at least one of the following manners (A) redemption for cash prior to maturity penalty-free for par value, plus any unpaid accrued interest earned to date of withdrawal, (B) transfer of ownership prior to maturity to one or more individual beneficiaries specified by the successor trustee without change of terms …”

The idea here is of course that my trust can be wound up not only promptly, but also for fair value and possibly considering preferences across the beneficiaries.

I would appreciate any expert comments on this matter.

Anonymous - #9, Wednesday, November 30, 2011 - 10:09 AM

There are no real advantages to a living trust over POD's. In fact there can be several disadvantages. Do your own due diligence to determine whether your estate actually requires an LT.Do not automatically take a lawyers  advice that you need one.

Ed (anonymous) - #10, Thursday, December 8, 2011 - 12:22 AM

I was told i may be benificiery to a c/d. how can i find out if this is true, the person has passed away.  should i contact the bank . im not sure how to go about it.thank you Ed.

KenBDG - #11, Thursday, December 8, 2011 - 8:43 AM

Ed, If you contact the bank and tell them your name and the name of the person who passed away, they may be able to confirm if you're a beneficiary of an account. The bank may need a certified copy of the death certificate before they disclose any information. You'll definitely need the death certificate to claim the account.

KLN (anonymous) - #12, Wednesday, December 28, 2011 - 1:37 PM

My father had 2 cd's with BofA totalling slightly more than the 100k required for probate in the state of California.  He had a trust and a will specifying my sister and I as executors/trustees.  BofA would not release the funds from the cd because the title on the cd was in my dad's name -not the trusts.

I went into the branch where the cd's were opened yesterday.  They said they DID NOT HAVE the original terms or info on the cds to determine if a beneficiary or death 'put' or POD was on either of the cds.  This seems unbelievable to me that they don't have this information at the branch where they were initiated.  They said I needed to go to court to get the 'letters testimentary' to access the funds - costing me court and attorney fees.

Meanwhile all his funds are in those cds and I have no way to pay his bills.  I felt like they were stalling and that by some type of fed law they should HAVE to have this information.

Any help is appreciated.

KN

Apache - #13, Thursday, December 29, 2011 - 2:59 PM

Do you have a copy of your dad's original CDs and do they have the POD or beneficiary listed anywheres on them?  If not, you may have a problem proving these CDs belong to you.  This is why I do not deal with any bank or CU which will not give me a copy of the CD with the POD or beneficiary listed on the CD even if it is on the back.  No matter how computerized we are, I still rely heavily on my "paper" copies of everything!  One credit union I just went with does not seem to send out copies of CDs and told me to print the info off the computer.  I did this and keep it in my folder with my other CDs for "just in case" there is ever a misunderstanding about what I purchased.

FinerTheBetter - #14, Tuesday, June 12, 2012 - 12:03 PM

So it seems like to most reliable way to prevent unwanted early closure is to not notify the bank about the until after the maturity date,

but what to do with the 1099s in the meantime? 

FinerTheBetter - #15, Tuesday, June 12, 2012 - 12:04 PM

Sorry the above post should read:

"about the death"

Anonymous - #16, Monday, September 10, 2012 - 10:00 PM

What is the problem with keeping the cd as is and hoping that the bank does not find out ?

Anonymous/Paoli (anonymous) - #17, Wednesday, September 12, 2012 - 4:43 PM

#16:  I would not advise that!  What if the original owner had monthly checks being sent to his/her home? Who is going to sign them?  When the CDs mature, it would be very odd to show up at that time and tell the bank the original owner is deceased and you would then have to still come up with what is necessary to prove you are the owner.  I would do it as soon as possible because if the bank fails then you have to prove you are the one who is supposed to be paid for the CDs.  Too many problems involved in your theory, imo.

Anonymous - #18, Sunday, October 28, 2012 - 10:49 PM

Hello, can anyone here help me? My grandmom in floridad passed away last 2010 and the executor informed me that I was named as a beneficiary of my grandmom's bank account but she refused to tell me the complete information but instead she asked me to write an authorization letter for her so she can access the account but I refused to do so and we never talked again. I was able to ask another relative to get me a copy of the probate document regarding my grandmom's estate and I saw a letter there coming from Bank of America stating that the previous account number of my grandmom's account was changed to a new account number due to her death and it should be filed with her estate but I wonder how come it was not stated as one of her assets in the probate document and her only asset that was reflected in probate is her life insurance bond. I already sent a letter with her death cert and my ID inquiring about a POD account to BOA branch near my grandmom's house but up until now there is no reply...any other suggestions?

Anonymous - #19, Monday, October 29, 2012 - 12:22 PM

I would suggest that you physically go to a Bank Of America branch along with the death certificate and your ID information.  Request that they look up the account and see if you are listed as beneficiary.  If you are, then it is your right to get a check for the amount coming to you.  To me, it is a little suspicious that the account number changed prior to distributions to the proper beneficiaries. 

Anonymous - #20, Wednesday, October 31, 2012 - 8:22 AM

Both my parents are dead.  I found that Wells Fargo was the most greedy of all the banks. It doesn't surprise me at all that they insisted you get the current rates on the rollovers. I'm sure Bank of America follows next in line.  I had some POD stuff from my mother - since my father took care of her.  The biggest deal - as you mention - is that having POD avoids probate.  But that's about all it does...

Anonymous - #21, Monday, November 5, 2012 - 6:53 PM

Our 13 year old son is beneficiary on his Grandmothers accounts at Wells Fargo. They refuse to hand the money over, it's POD. They are requiring my husband and I go to a lawyer and then go to court to "prove" he is our son. After two days of talking to them I requested they write down exactly what it is they want. As no one, not a lawyer nor anyone at the courthouse, ever heard of such a thing. They then said we need to get guardianship or conservatorship over him. They insisted its the same thing (I know it's not). We took in her death certificate, his birth certificate, his SS card, his baptism certificate and our tax returns. None of that is good enough for Wells Fargo. We haven't done anything yet. We a still in shock they expect us to hire a lawyer and go to court when he is our son and we are his legal guardians anyway. Anyone heard of such a thing? It's in the state of Iowa if that matters.

Anonymous - #22, Tuesday, November 6, 2012 - 2:36 PM

Could there be some problem with Wells Fargo being concerned that a 13 year old is not qualified to handle or make decisions over a large sum of money and since they may figure you and your spouse will be directing him that they need to make sure you show proof you are his parents?  I don't think they would have this concern if your son was not a minor.  This is very interesting to know so that others who put minors on as PODs will ask the bank what is involved when time comes for them to collect.  I don't see why a lawyer needs to get involved as long as you verify he is your son.  This should be a good lesson for others to learn before they put minors on as PODs. 

Anonymous - #23, Tuesday, November 6, 2012 - 7:45 PM

#18:  I agree with #19.  I think you need to find a way to go to the bank in question and insist on seeing the account you were named beneficiary of.  I would think it is the Executor's responsibility to provide you with the information you need to access the account.  As in my post to the other poster about Wells Fargo, if you are a minor, you might do well to get a family member to go with you to the bank to make sure you get what your grandmother wanted you to have.  Something seems wrong that anyone could change the account number after your grandmother's death unless they took control of the account.  You should insist on knowing just who did that since the account was supposed to pass on to you.  From everything I know from having PODs on CDs for years, all that is necessary for the POD person to do is to present a copy of the death certificate of the original owner of the CD and their ID to show they are the person named on the account as beneficiary.  What is very important here is that your grandmother did know to put your name on the account as beneficiary.  I think once you find out who changed the account number and why, you will then get to the bottom of what is going on here.  Best of luck to you!

Anonymous - #24, Tuesday, December 4, 2012 - 7:15 PM

My father recently passed away and he (and my mother) have a couple of CD's which are titled His name, my mother's name and then "POD my sister's name & my name", my question is - if my mother cashes these and gives them to us, am I responsible for paying any type taxes? Everyone I ask has told me no, since I am listed on there already????

lou - #25, Tuesday, December 4, 2012 - 7:49 PM

#24, it depends on the size of the CD and whether it exceeds the gift tax exclusion for your mother. Since your mother inherited the CD, you will not have to pay any tax if your mother cashes the the CD and gives you the money. However, your mother may have to pay gift taxes if it exceeds either the annual gift tax exclusion or her lifetime exclusion, which is actually changing on Jan 1 if Congress does nothing to change the law in the meantime. So if you are going to do this, you may want to accomplish it before yearend.

Paoli2 - #26, Wednesday, December 5, 2012 - 7:47 AM

#24 This, imo, has nothing to do with the fact you "were" listed on your father's CD.  The CD was to go to you and your sister only after the death of both of them since your mom was joint owner.  How you were listed on CD plays no part of this unless mom makes you POD of it with her as owner.  As for taxes, I think Lou is correct about staying within the annual gift tax exclusion for whatever it is now or the lifetime etc.  You should not be hit with taxes and neither will  mom if she stays within the bounds.

Anonymous - #27, Thursday, December 20, 2012 - 3:07 PM

I am listed as the beneficiary on my mom's IRA at Wells Fago.  Everything I'm reading sounds pretty cut and dry as far as getting the money, however, do you think because it's an IRA there would be any complications in receiving the money?

lou - #28, Thursday, December 20, 2012 - 4:38 PM

Yes, inherited IRA's have restrictions in how you can distribute the money without incurring taxes on the undistributed dollars in the IRA. You should have a company like Fidelity or Vanguard act as the trustee, so you are certain that you are in compliance with IRS rules. If you don't do the transfer correctly, you could have the entire amount subject to federal and state income taxes.

Anonymous - #29, Thursday, December 20, 2012 - 10:07 PM

I guess my real question is..Is there a waiting period for Wells Fargo to distribute the funds..even though I'm the POD?

Paoli2 - #30, Friday, December 21, 2012 - 8:01 AM

#29   IRS Pub. 590 page 17 explains what happens when you are beneficiary of an IRA and you are not the spouse.  Rules are different for spouses.  From what I understand, Wells Fargo or whatever institution the funds are in must turn over the account to you but you have certain rules you have to follow with what you can do with these funds if they were in an IRA so that you won't be taxed on them until you do the Required Minimum Distributions.   I don't think you it's a matter of your getting a check from Wells Fargo and just doing what you want with it.  You can read the rules in Pub. 590 on-line.  For 2011 it was page 17.  I don't think the 2012 copy is available yet. 

Paoli2 - #31, Friday, December 21, 2012 - 8:04 AM

#29  That is supposed to be Page 16 for Inherited IRAs in Pub 590 in my above post.  Sorry for the error.

Anonymous - #32, Friday, December 21, 2012 - 1:38 PM

Thank you for your help!:)

Anonymous - #33, Friday, December 21, 2012 - 5:21 PM

I posted question # 18, i have an update with what happened and i wanted to know your ideas guys hope you could help me on this. I was able to get a certified copy of my grandmom's living trust as well as a letter coming from BofA regarding a release and satisfaction of claim statement with previous and new account number being set up on that. I faxed those documents as well as my Ids (passport) to BofA and told them I was one of the heirs of my grandmom (real estate property) and i just want to know if i was named as beneficiary of her POD account because last 2010 when my grandmom died the executor contacted me and informed me of being a beneficiary of a bank account (executor did not specify which bank) and was asking me to make an authorization letter for her (executor) to access the account but i refused to do so and she never talked to me anymore until now. My problem is when I faxed those docs to BofA and introduced myself to them they told me they cannot help me and I should talk to the executor. I also saw a document stating that the only asset declared in probate (formal administration) was my grandmom's life insurance ( no banks accounts,ira,401k declared) but bank accounts,401k, retirement accts were mentioned in her living trust but did not mention specific names of beneficiary. Any ideas why i should talk with the executor if it was a POD account with beneficiary? So far only BofA is the bank i see in the documents that my grandmom banked with when she was still alive that is why i contacted them regarding the situation but unfortunately they dont tell me any information. :(

Paoli2 - #34, Friday, December 21, 2012 - 6:52 PM

#33  I don't understand what is going on with your grandmom's Executor.  From what I know the Executor takes charge of seeing that the people who the deceased left money or property to gets what they are due.  I would think the Executor would have to have knowledge of where the money or property is so they can give this to those who are named.  This is why they are named as Executors so they can take care of this responsibility and see that everyone named becomes aware of what they get and where it is.  Maybe this Executor is not aware of his/her responsibilities towards the inheritors.  If anyone should know where the banks are and how you get your funds, the Executor should.  I can see the bank wanting proof from you that you are the one named to inherit but your ID and a copy of the decease's death certificate is all I was ever told my inheritor would need upon my death. 

Your problem is the reason everyone should tell beneficiarys "ahead of time" that they are being named in a Will or if they are on a CD as a POD, give them the info of the banks ahead of time.  I typed up a booklet for the person as POD on certain of my CDs with names, addresses and phone numbers of any and all banks to contact upon my passing.  I am not leaving this to my Executor to do. In fact, today I updated the info as I always do when any CD matures and/or I change the bank which they are POD on.  I also included in their booklet info on how to handle any IRA accounts they "may" inherit since these must be handled differently from regular CDs.   This may sound nutty to you but if I were in your position especially with this Executor, I would call all banks in my grandmom's city and ask them if they have any open accounts in her name.  It makes no sense she would make you POD and not make her Executor aware of which bank it's with.  I would also call BOFA and ask to speak to someone higher up and ask their help in finding which accounts have or "had" your name listed as POD.  Maybe they matured before she passed and she used the money for something else.  If she had any "nicknames" for you be sure to request that BOFA check for you under any and all names she might have used for you.  Maybe you are giving them a name that is different from what she gave them.  Hope you work this out.

Joey (anonymous) - #35, Wednesday, January 2, 2013 - 10:41 AM

My son an I are named on my fathers accounts at Wells Fargo as POD. He is 13, a minor, and we are having trouble with this. We are in NC and I'm not sure on the laws but like someone else posted I was told I had to get a court ordered proof of guardianship for our son. I have no idead what to do.

joey (anonymous) - #36, Tuesday, January 8, 2013 - 4:12 PM

Also they will not release any of the funds until we are able to do this. I dont understand why they cant release my portion. To become my son estate guardian we have to be bonded for 1.52% of the total amount our son is to receive. Sure would help if they would release my funds.

Anonymous - #37, Saturday, January 12, 2013 - 1:40 PM

SENT W9 AND DEATH CERTIFCATE TO J.P MORGAN 401K.AS BENEFICARY WHEN DO I RECIEVED THE MONEY .WHEN DO THEY CUT CHECK AND SENDING IT TO ME

Anonymous - #38, Wednesday, January 30, 2013 - 6:00 PM

My parents opened a cd listing me as owner several years ago. They have both passed away. I do not recall anyone talking about POD. We all assumed it would just transfer into my name. Does this have to go through probate court?

lou - #39, Wednesday, January 30, 2013 - 7:50 PM

No, the CD is in your name

Paoli2 - #40, Wednesday, January 30, 2013 - 8:00 PM

How does he know the CD is in his name?  I think the poster needs to see the actual CD and if his name is on it or not.  If his/her name is on the CD with the parents then it belongs to the poster and is not probatable.  Assuming it would transfer into the poster's name does not mean it actually was done.  This can be resolved by just contacting the bank and finding out whose name/names are on it.

Anonymous - #41, Monday, February 4, 2013 - 8:48 PM

Can anyone help me with this one? My step Mother died Nov. 27th 2012 in Calif. A community state. My Father still living, legally married and 84 years old. 40 days after death anyone can buy a death certificate for $20.00. There were two accounts in wifes name only. No signers, no benificeries, no POD. A hand written will saying at her death everything goes to her husband my Father. So 40 days after death funds are available. I call my dad to instrust him to go get the funds. (I live out of state) He goes to the bank and a grandaughter withdrew $41,500. The bank says the granddaughter came in with a death cert. and a signed notorized affidavit. We are still stunned. Any ideas anybody??

Paoli2 - #42, Monday, February 4, 2013 - 9:40 PM

#41  I used to live in a Community Property state and am sooo glad I am not any longer.  The rules are quite different even if one has a Will.  You might want to google up information on California'a Com.Property laws.  First of all, she was your step-mom and she did leave a Will leaving the funds to your father.  Was this her "Seperate" Property or was it truly Community Property?  Being a step-son you would need to find out if you were in line to inherit any of the funds.  Community Property inheritances are not open and shut like other states where one can have a Will stating exactly who you want your property to go to.  Maybe the granddaughter had more of a right to the funds than a stepson of the deceased.   Your relationship to the deceased is different from the grandaughter and I am wondering why you seem to take it for granted the funds or some part of them belonged to you.

lou - #43, Monday, February 4, 2013 - 10:49 PM

Consult with an estate attorney ASAP. Don't try to figure this out without legal advice!

Anonymous - #44, Tuesday, February 19, 2013 - 7:10 PM

Ok this is what I've been looking for.  My story has a slightly different twist.  My mother left a number of CD's for my sisters and I.  I'm am the POD/POA on the CD's but my sisters are listed.  After my mother died one of the banks made me close the CD.  The other two banks let me keeps them to maturity (1-3 years).  They never changed the CD ownership and the 1099-INT to my tax i.d., it remained in my Mothers name even though she had died.  They have all been 2 years collecting interest under her ss#.  I am not filing her taxes anymore because the interest is not enough to meet minimum filing requirement.  I also did not claim the interest on my returns in 2011 and soon 2012.  What do I need to do?  Do I need to go back and revise my returns to report the interest?

lou - #45, Tuesday, February 19, 2013 - 7:44 PM

You really are asking two questions: What are the tax consequences and are the CDs property titled? I am no expert but I would think the POD designation is invalid and if anything happened to the bank, you may be ineligible for FDIC insurance. I could be wrong about this. Why don't you call the FDIC office in your region and ask.

As for the tax consequences, since your mother has been dead for two years, I think the following citation from Pub 559 is applicable:

"Interest accrued on savings certificates.   The interest accrued on savings certificates (redeemable after death without forfeiture of interest) for the period from the date of the last interest payment and ending with the date of the decedent's death, but not received as of that date, is income in respect of a decedent. Interest accrued after the decedent's death that becomes payable on the certificates after death is not income in respect of a decedent, but is taxable income includible in the income of the respective recipients."

This seems to suggest that you needed to include the interest income on your own return or prorata with your sisters if they are listed as beneficiaries. Alternatively, you could do nothing and see what happens with the IRS. In that you never received a 1099, I am not sure how they would ever know.

 

 

Anonymous - #46, Tuesday, February 19, 2013 - 10:27 PM

Thanks much.  As I thought, a conundrum.  I could blame it on the bank but I'm sure the IRS would not care that they mistakenly did not transfer the CD to our names.  Regarding invalid POD, we are about to get dispersed the final 2 CD's maturing next month so no risk there.  I will go see a tax consultant I suppose.  I was just going to let it fly as is but I'm feeling concerned about IRS coming after my dead mother and then after us at a future date.

Anonymous - #47, Wednesday, February 20, 2013 - 9:53 AM

As an addendum to above, would it be ok for me alone to amend my returns to include all of the CD interest from 2011 and now in 2012 and leave my sisters out of it so they don't have to refile themselves?

paoli2 - #48, Wednesday, February 20, 2013 - 10:12 AM

#47  Why don't you ask your sisters if they received any 1099Ints for these certificates?  If the interest was $10.00 or less for their portion, they may not have received any 1099Ints.  I would think your sisters are responsible for their own portion of interest from the CDs and you are responsible for yours according to what was reported to the IRS. 

Anonymous - #49, Wednesday, February 20, 2013 - 11:23 AM

Only my deceased mother has received the 1099-INTs because the CD's were never transferred over to our names and tax i.d.'s.  We have been cashing them out as they mature (as listed POD's) but haven't paid any tax on the interest because the interest and CDs themselves are in my mothers name still.  That was the original point of my post.

lou - #50, Wednesday, February 20, 2013 - 3:12 PM

Technically speaking, if your sisters received some of the interest from the CDs they should probably amend their returns also.  However, if you decide to amend your return only, then just report 100% of the interest received. I don't think the IRS will pursue it as long as someone paid tax on the interest income.

lou - #51, Wednesday, February 20, 2013 - 3:16 PM

You could do nothing. If the 1099's are in your mother's name, I don't see how the IRS will ever know. If they found out, you would just pay the tax.

 

Anonymous - #52, Thursday, February 21, 2013 - 10:11 AM

Thanks, I would probably do nothing but I assume the IRS will send a letter in my mothers name someday about undeclared 1099's and I would not only have to pay the tax but a penalty as well.  Remember that we are listed on those 1099's as POD's so they know we are the beneficiaries.

lou - #54, Thursday, February 21, 2013 - 11:29 AM

#52, I understand - the safer route is to pay the taxes now and not to have to worry about the IRS someday. BTW, I have never seen POD beneficiaries listed on 1099's. Are you sure about this?

Anonymous - #55, Thursday, February 21, 2013 - 12:00 PM

My name and my sisters names are listed as POD under my mothers name on one of the bank's 1099-INT forms but not listed on the other banks.  I think this is because the first bank has titled the account this way and it just shows up whenever printed out on anything.

Looking for an answer (anonymous) - #56, Tuesday, February 26, 2013 - 2:42 PM

My father just updated his Will and named my oldest sister as the Executor and also giving her a durable or spring power of attorney should he become ill and unable to manage his personal business matters.  My father has several CD's with differant banks and has all 3 kids listed as POD on each. My question is "should our father become ill and his medical cost requires money from the cd's to pay them can the durable or spring POA cash the cd's or change the POD's in order to cash the cd's?  We live in NC if this helps.

Anonymous - #57, Tuesday, February 26, 2013 - 4:58 PM

#56:  As long as it is a Durable or Spring POA, your oldest sister who is listed on it should have the power to do anything that your father would do if he were able.  I would think using the CDs to pay for his medical expenses would fit in this category.  When we had our POAs done this is the way it was explained to us.  This is why it is very important to trust the person who is named on the POA.  It gives them a lot of power which we have to trust will be used in the way we would if we were able.  I asked our banks what we would have to do if a CD were maturing etc and we were incapacitated and was told the person named on the POA must bring it in as proof of their right to take control at that time. 

Anonymous - #58, Tuesday, February 26, 2013 - 7:00 PM

My estate attorney recently told me that the Power Of Attorney gives you the power to make the POD changes as you describe above.  The only catch was that it depended on the banks that you were doing business.  Some will honor the power of attorney's authority to make changes to pod and some may not.  So it might be a good idea to discuss this with the banks that you currently have the C.D.  Your father's attorney who updated the will should also be someone you could ask for help on this.

Anonymous - #59, Wednesday, March 13, 2013 - 9:04 AM

When  purchasing CD's is it better to have POD or joint account with the person?  My concern is if someone has exhausted all of their Long Term care money in a Nursing Home, can the home take all of the money in the CD's if it is only POD?  My mother in law is concerned that her grand children will not get the money should this happen.  She has been told, she have enough Insurance  along with her pension for seven years.   Any ideas?

Anonymous - #60, Wednesday, March 13, 2013 - 2:31 PM

This is great information. I have a similar issue to someone above. My Aunt passed away last January and her CD's all had POD's on them. Most all were cashed out and given to the beneficiaries. Please note that I am the executrix for her estate; and the estate did not need to be probated. I didn't think another thing about it until I just recieved a 1099-INT from one of the banks and all of the interest that was paid out with the cd's to the bene's is now charged to her. The bank is telling me that it's because she was the tax reportable name on the account. I'm fine to pay taxes on any money received into her accounts, however why is she being charged for interest paid out to someone else? Also why bother getting the SS#'s for bene's if there's no reason. Thoughts anyone? Thanks.

Anonymous - #61, Saturday, March 16, 2013 - 2:39 AM

My father recentley died and he always spoke of a CD he had for me as a beneficiary, The executor will not give me any information to say the least, and had the will changed fraudently,   How can I find out which bank it would be at, if I do not know at this time, Please help, Thanks much.

Anonymous - #62, Saturday, March 16, 2013 - 3:47 PM

I don't understand why there is so much confusion over what is going on with CDs when the owner passes.  Aren't there any attorneys involved with these Wills?  If there is an Executor named, there must be a Will.  Being an Executor is a very important position and I think there can be legal ramifications if they abuse their responsibilities.  If you are mentioned in the Will, the Executor must notify you.  If it were me,I would try to find the attorney who did the Will and let him know what is going on.  Maybe you are not really in the Will.  People do change their mines before they become deceased.

patricia dempster (anonymous) - #63, Monday, March 18, 2013 - 9:57 AM

i had are letter saying i was are beneficiary abut 12 years but i lost the letter i know the letter was from edinburgh i know i was left alot og shares but i dont know who to contact

Anonymous - #64, Tuesday, March 26, 2013 - 7:53 PM

my grand mother passed about 2 months ago. and she had a cd for me at bank of america.. well the issue is that in the state of ny the grandaughter cannot obtain the death cerifacte.. for only certain reasons (as for me being the beneficiary) i would need proof. well i dont have any proof. i only seen paperwork with my name account# amount etc. the big issue is my mother cleaned out my gma house and took all her paper work before i had a chance to get anything and me and my mom has NO relationship what so ever . So i believe my mother was able to provide the death certicate to all my grandmother banks she had. so they made her something of state.. meaning she has access to everything my grandmother has. i dont how i would be able to get proof to get the death certicate. and also to find out if my grandmother and anything else left for me.

lou - #65, Tuesday, March 26, 2013 - 8:05 PM

#64, talk to a lawyer.

C.G. (anonymous) - #66, Thursday, April 18, 2013 - 1:43 PM

This is is a great site!  I wish they could add a "printer friendly" icon for the articles next to the Facebook and Twitter icons.

Also, my father recently passed, making me the last member of our family line.  Does anyone know about making non-profit and charitable organizations beneficiary to bank accounts, savings bonds and insurance policies?  Are social security numbers needed?  Does some representative have to sign? 

TJ (anonymous) - #67, Thursday, April 25, 2013 - 5:09 AM

I live in Wisconsin.  My mother just passed on and left a will. The personal administrators we agreed upon in probate. Just today we found out my mother left a CD of 115,000.00. The personal administrator said she had to issue checks to two people..one her mother and the other half went to the other personal administrators because she said they had P.O.D. accounts. Now the att. they hired told the family this matter would have to be separate from Probate. We are also excluded from all information in reference to this because of probate..so were told.  We do not believe our mother left this money to these two people. How can we get the paperwork for this CD?  We are disabled and can't afford an attorney.  

Anonymous - #68, Thursday, April 25, 2013 - 6:55 PM

If the CD had designated POD beneficiaries, then the bank  has the sole responsibility to issue the money in the correct amounts to the designated beneficiaries.  The bank should not and is not allowed to distribute the money to anyone else  other than to the beneficiaries.  If someone other than the bank is distributing this POD money, then I would suspect something is not right about this and I would head straight to a lawyer to get advice on this.

paoli2 - #69, Sunday, May 5, 2013 - 2:38 PM

If a spouse has several bank CDs in her name only POD to an adult child and her spouse has to go into a nursing home, does Medicaid have the right to claim those CDs even if the other institutional spouse's name is not on them and has no access to them?  Thanks for any info you can provide.

lou - #70, Sunday, May 5, 2013 - 2:50 PM

Yes, up to a certain limit. The spouse is allowed some money, but the limit, if I remember correctly, is quite low. This is the principal reason why I bought long term care insurance.

paoli2 - #71, Sunday, May 5, 2013 - 2:54 PM

Thanks Lou.  I misunderstood and thought they could only go after the resources, income and assets of the Spouse who is institutionalized.  I guess they add up all accounts if you are married no matter which one needs the nursing home.  I knew the Community spouse gets to keep "something" but that must be after they take over all accounts for both of them.