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What Are Payable On Death Accounts, And How Do They Fit into My Estate Planning?


Transfer on death accounts—also known as Payable on death accounts in states like Florida—allow a couple to designate who receives their accounts and assets after the second person (with joint accounts) passes on as part of their estate planning. These accounts are governed by state law and are part of the account custodian (for example, the bank)’s contract with the account owner (usually a couple).

The Law in Florida

While in some states, beneficiaries of payable on death accounts can receive investment accounts and a home, all avoiding probate, retirement accounts and employer plans are never eligible because they are governed under federal law, and in Florida, lady bird deeds take the place of payable on death beneficiary when it comes to property.

The Rules of POD Accounts

Payable on death accounts can include children, friends, and other relatives. While taking control of a payable on death account is usually very straightforward, and typically only requires presenting the death certificate and picture ID, note that many contracts that govern payable on death accounts include a clause that indemnifies the bank or other institution from claims if issues arise, such as if the account is disallowed or if you fail to update your beneficiary designations. In addition, these accounts may be subject to tax and are also not out of reach of the decedent’s creditors, depending upon the circumstances. Account custodians will often make access to these accounts somewhat conditional in an effort to protect themselves from potential liability.

Some contracts also stipulate that the beneficiary confirm that the account owner was free of debt at the time of death and/or that the decedent’s state of domicile was the same state in which the account is located. Of course, if a payable on death account has more than one beneficiary, the claiming process can become more complicated. Most payable on death accounts allow for multiple beneficiaries to be designed; each with a different percentage. If a payable on death account does not have a beneficiary, the account is paid out to the estate, and the decedent’s will controls.

Speak with Our Experienced Florida Estate Planning Attorneys to Find Out More

Taking the time to meet with experienced Florida estate planning attorneys in order to ensure that your estate planning documents—including everything related to payable on death accounts—are updated and reflect your wishes and intentions is crucial for you and our family. It is also important that any payable on death account designations are coordinated with your will. Contact our experienced Sarasota wills & probate attorneys at Suncoast Civil Law today to find out how we can best help you in creating a future for these accounts.