Florida payable on death accounts are financial tools used to keep funds shielded from the probate system. The money is held in a bank account with directions to transfer it to another person/beneficiary upon the primary account holder’s death.
The primary account holder can still access the money while they’re alive, and the recipient will receive whatever still remains in that account after the account holder’s death.
Payable on death accounts, as spelled out in F.S. 655.82 are sometimes the subject of inquiry to our Fort Lauderdale probate litigation attorneys. Let’s say you are the sole surviving heir of a parent. Their spouse has died. They have no other children. You might assume yourself the sole recipient of any of their assets, aside any creditors. However, that may not be the case if your parent had a payable on death account that named someone else the beneficiary.
Payable on death accounts – sometimes referred to as informal trusts, revocable bank account trusts or tentative trusts – are financial tools commonly used to keep sums of money out of the probate system.
Totten trusts are also sometimes considered payable on death accounts.
Can I Challenge a Payable on Death Account?
Payable on death accounts are similar to life estates and trusts in that none of these can be subjected to probate. Because these accounts aren’t part of the probate estate, the estate executor has no jurisdiction over it.
Upon the account holder’s death, the payable on death account becomes immediately the property of the beneficiary. All that person must do must have the bank re-title the account into her name upon presentation of the death certificate to the bank, along with a transfer request.
It may be possible to assert that the assets contained in a payable on death account should be made part of the probate estate. However, doing so would require the estate to prove the beneficiary’s designation as such was because of that person’s wrongdoing, typically by undue influence or fraud.
Undue Influence and Fraud
In order to establish undue influence, one must prove the decedent was induced to act in a manner that wasn’t of their own free will or without adequate attention to the consequences. It can be difficult to prove undue influence against a spouse or sole surviving child, but our probate litigation attorneys can help you determine if you have grounds to assert a claim of undue influence on payable on death account assets.
Then there is fraud, of which there are two different types.
- Fraud by inducement;
- Fraud in execution.
Fraud by inducement occurs when someone tries to convince the decedent (or “testator”) to act by means of deception.
Fraud in execution happens when the beneficiary misrepresents a document in order to compel the testator to sign a payable on death account over to them.
Payable on death accounts are fairly easy to create, and free. Because the process is so accessible, it can be vulnerable to fraud or undue influence. Working with an experienced probate litigation attorney, you’ll be able to determine whether you have adequate evidence to challenge the beneficiary’s right to those funds.
Call Fort Lauderdale Probate Attorney Richard Ansara at (954) 761-4011. Serving Broward, Miami-Dade and Palm Beach counties.
Additional Resources:
F.S. 655.82, Florida’s Payable on Death Accounts Statute