I am a beneficiary on a POD account. Can I put that money in the estate account and distribute per the will instead?

Question

I am a beneficiary on a POD account. My siblings (all deceased now) and I, were named as beneficiaries on my (deceased) father’s bank accounts. Since I'm all that's left, they paid it out to me. My father updated his will before his death to include other family members and I would like to honor those wishes and distribute my inheritance accordingly.

Edward Armstrong · Answer

It's nice that you want to honor your father's wishes but you are not legally obligated to share the money from the POD account with anyone.  POD account proceeds would not have been a part of his probate estate so the will would not govern this asset.

Victor Waid · Answer

The answer is no as this may cause the estate additional expenses, and shouldn't be done..  If you want to make gifts of funds received as a result of POD accounts, , then do so with the advice of a CPA as to your gift tax consequences.

Nathan Wagner · Answer

You can distribute the money to the other family members, but be aware that the IRS will take the position that you personally are making a gift to these family members. You could subject yourself to gift tax by distributing this money.

Kathleen Delacy · Answer

The POD account is your's so you can do whatever you want with the money.

Michael Stafford · Answer

Yes you can. However, before you do so contact your accountant to determine whether there will be gift tax consequences. Since you received the money any transfer of the money is a gift and the amount you transfer to other people could be subject to a gift tax which you would have to pay, so check with your tax advisor or accountant first.

James Frederick · Answer

Yes, you can certainly distribute the money, as you see fit. You would not open an estate, however. You would simply distribute to the beneficiaries directly. You would need to file a gift tax return if you exceed $14k to any given beneficiary in a year, since these transfers would be considered a gift under IRS rules.

Frances Headley · Answer

You should consult an estate/probate attorney to discuss your plans and its ramifications. You may be incurring tax liability for gifts if you carry out your plan.

Brian Haggerty · Answer

Good for you; yes, you may. If the amount going to each of the other family members is more than $13,000 you will want to establish (maybe by a letter to the PR of your father's estate) that you are not making gifts to them, but that you know that your father made the POD designations with the intent to benefit the whole family.

Christine James · Answer

You can but do it with the probate attorney and document it properly as assigning it to the estate so that it is properly treated.  Or you can simply share those accounts with the family outside of the probate which would probably be cleaner and easier.

Dara J. Goldsmith · Answer

If the amounts are under $14,000, and you have not otherwise gifted to the respective donee in the year, it may be easiest to make a tax free gift to the intended persons. If that is not an option, because the amounts are over $14,000 or you have otherwise gifted to the done, you may need to consider using a qualified disclaimer (pursuant to State law) and probating the asset or making a taxable gift.   In Nevada, a qualified disclaimer must be made within 9 months of date of death. There are other requirements, too.   I suggest that you speak with an experienced estate attorney in your area to address these options.  This information is only intended to give general information in response to an inquiry.  It does not establish an attorney client relationship.  This response is only based upon the limited facts presented and is merely intended to assist you in determining if you should contact an attorney to provide you with legal advice.

Thomas Edward Gates · Answer

There is nothing preventing you to do so.  The money in the bank account by passes probate and belongs to the joint tenant or designated beneficiary. These funds need not be distributed.

Mark T. Peters · Answer

Maybe.  You have to do it in a way that it is not a gift from you to them.  Perhaps if you file a statement that your name was on the accounts for convenience only, but were not the intended recipient, that might work.

Thomas Phipps · Answer

Since your father put that money into a POD account, it passes outside of the will.  The money is yours and does not have to be distributed to the others named in the will.  However, if you wish to include those family members, you may distribute according to the terms of the will.

Jonathan Shimberg · Answer

You give money as you may choose, but there are tax consequences of doing so, depending on the amount. You are allowed to gift $14000 per donor per done a year. Anything above that is subject to gift tax and must be reported to the IRS (but you can claim part of your lifetime exemption).  If the money was left to you and not to the estate, you have no obligation  to distribute it to anyone except yourself.

Jayne Sebby · Answer

You may distribute your inheritance as you wish.  Check with and accountant as there may be taxes due on larger gifts.

David Leon · Answer

The money is yours. You can do with it what you please.

Gerald Bagazinski · Answer

There is no problem. There may be gift tax issues, but I would assume a constructive trust argument might be appropriate.

James Maguire · Answer

The funds are yours. You can do whatever you want with them, including   gifting to others.   You don't have to use the estate account for this.

Jeffrey Gottlieb · Answer

Part of the answer will depend on how much money we;re talking about. You can always gift to those individuals. Gifts up to $14,000 per beneficiary per year don't even have to be reported. Even if you're over that, the lifetime exemption is $5.25 million so there won't be any tax due unless the amount is really big.  Or you could potentially disclaim your POD interest. Depends on how the designation reads.   Talk to a probate attorney about the best way under your facts.

John Brennan · Answer

It is possible, but not required, I would suggest you seek counsel as there are other possible complications.

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I am a beneficiary on a POD account. Can I put that money in the estate account and distribute per the will instead?

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