Trust Bank Accounts

Defined Not a real trust; just an account at a bank, credit union, or other financial institution. “A in trust for B.” “A, trustee for B.” Other terms: Totten trust Savings account trust Tentative trust

Ownership during T’s lifetime Trustee (depositor) has all rights. May withdraw without notice to or consent of B. No split of title. No imposition of duties. If more than one trustee (depositor), they own in proportion to their net contributions.

Ownership After T’s death Beneficiaries have rights only after: All trustees have died, and Beneficiary has survived all trustees.

Potential Benefits Avoid probate – money immediately available to beneficiary Inexpensive Depositor gives up no control Effective to make small gifts in large estates

Potential Disadvantages No professional management Low rate of return No tax benefits Confusing to clients Use Pay on Death accounts instead