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Joint Assets by H/W Transfer to Trust

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correns

Junior Member
What is the name of your state (only U.S. law)? Missouri

My parents have joint accounts (JTWROS) and they want to put a TOD beneficiary to be either of their trust. FYI, they each have their own trust. I am not sure if this is advisable. I would like to hear your opinion. Thank you.
 


Kiawah

Senior Member
That's more of a financial advisor question.

Depends upon the purpose of their trusts, and how they are written as to who receives the income and assets. Depends upon the value of their estates, how much in each of their names, how much jointly held, what kind of debts. Depends upon their income jointly, their income when one passes, and their fixed and variable annual costs, etc, etc. There are way to many variables.

Have a financial advisor review their current situation, and plans.
 
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TrustUser

Senior Member
what do you mean by either of their trusts ?

do they want it go half to one trust and half to the other trust ?

do you realize that the tod is meaningless after the first parent dies, since it can easily be changed by the living parent ?

the main functionality difference between having monies in a joint account versus a joint trust is access to the funds when neither parent is competent.

in a trust, the successor trustee can somewhat easily take over.

in a joint account, some sort of power of attorney is needed. and financial institutions do not honor them nearly as well as they would a successor trustee.
 

correns

Junior Member
Sorry if my question is a bit vague and generalized.

My parents have a couple of bank accounts held jointly and 1 account in a mutual fund company held jointly. The amounts are not huge...several thousands of dollars, at the most. They were asking me if they can put my dad's revocable living trust (or my mom's RLT, does not matter really) as "beneficiary" in ALL of the joint accounts (no need to divide the amounts). I really do not know what to tell them, except to consult with their attorney, but I'm curious how this work out.

"do you realize that the tod is meaningless after the first parent dies, since it can easily be changed by the living parent" ? No I didn't, thanks for telling me. I don't think either will change what's on the tod, once the other partner dies, though.

From what I know, if my dad, for example, dies first, then the account becomes my mom's and when she dies, the account is transferred to the trust, if the trust is the beneficiary. Am I correct in this thinking?

I also don't think they will pay federal estate tax (or if they do, not much) because their estate falls under the $1M exemption (at least in 2010).

Thanks for your inputs kiawah and TrustUser.
 
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curb1

Senior Member
Have they told you the reason they would want to do this? If you are talking relatively small amounts I cannot understand any advantage.
 

TrustUser

Senior Member
if a bank account is not titled to a trust, then i would say it almost always makes sense to have a beneficiary attached to it.

if your bank can place a trustee of a trust as the beneficiary, i see no problem with that, since the rlts are what explain what you want done with your money when you die.
 

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