Contact:
Alison Arden Besunder
212-695-8100, ext. 289
[email protected]
Do I Need a Will If All My Assets Are in Joint Accounts?
The unequivocal answer is Yes.
Many people erroneously believe that they do not need an Estate Plan or Estate Planning documents if all of their assets are in joint accounts with their spouse or their children.
Although joint accounts are intended to pass directly to the joint account holder after the other account holder’s death, it remains critical to have a Last Will and Testament in place to administer assets that may be outside of those joint accounts at death (i.e., outstanding checks that have not been cashed). If the decedent had applied for and received Medicaid benefits, it is particularly important to have these documents.
Keep in mind that a “joint account” can be challenged. The law allows a presumption of joint ownership but that presumption can be overcome.
Sometimes a parent will title an account jointly with their child because the parent wants the child to handle his or her banking, pay bills and to have uninterrupted access to the account if the parent becomes incapacitated, all for the parent’s benefit. This is a “convenience account” that is deemed property of the probate estate and subject to collection by the Executor.
Alternatively, the parent names the child as a joint owner to have the account pass to the child on the parent’s death without probate. In that instance, the child is a co-owner of the account and not merely a signatory for the convenience of the parent.
However, in order to avoid any dispute as to account ownership, it is particularly important to sign a written statement indicating that all assets held in a joint account shall be considered the joint owner’s property on the parent’s death and NOT a convenience account. Additional precautions may help provide evidence as to what type of account was intended.
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