Case Study 6 - The dangers of making someone a co-owner of a bank account as joint tenants with right of survivorship.

Answers for Idaho Residents

The following answers are based upon Idaho law as of June 2005. The laws in other states may be different. Laws are subject to change, so please ask your attorney for answers to specific questions.

1. The bank account may be subject to Jane's (her youngest child’s) creditors.

Idaho answer: True.

The bank account may be subject to Jane’s creditors during her life. At her death, Chapter 6 of the Idaho Probate Code may allow Jane’s creditors to seek payment from “non-probate transfer” accounts to the extent that her probate estate is insufficient.

2. Jane could withdraw the entire amount in the bank account and deposit it in another account in her name only.

Idaho answer: True.

As a joint tenant, Jane can freely withdraw any amount from the bank account.

3. Mary has made a gift of one half of the account to Jane.

Idaho answer: It depends.

Mary may not have intended to give Jane current access to the funds, so a gift may not occur until and unless Jane withdraws funds from the account.

4. At Mary's death, what will happen to the bank account she co-owns with Jane?

Idaho answer: B.

Jane will get all of it.

The survivorship language allows Jane to withdraw all the funds. However, unless the account is a “P.O.D” (payment on death) account, Mary’s estate may be able to keep control of the account.

5. Instead of opening a joint account with right of survivorship with Jane, Mary had the following options:

Idaho answer: D. All of the above (A, B, and C).

A. She could have opened a personal agency account naming Jane as her agent.

B. She could have executed a durable power of attorney naming Jane as her agent.

C. She could have signed a card at the bank giving Jane authority to make deposits and withdrawals from her account.

Return to Advance Directives Case Study 6.

View the Communicate Your Advance Directives for Health Care learning lesson.

Credits

Adapted for use in the Legally Secure Your Financial Future: Organize, Communicate, Prepare program.

Content Development by:
Beverly Healy, M.Ed., Professor and Ada County Extension Educator,
University of Idaho.

Reviewed for Idaho use by:
Robert Aldridge, attorney, Boise, Idaho (September 2004),
Robert Wreggelsworth, attorney, Boise, Idaho (June 2005).

This information is provided as a public service and is designed to acquaint you with certain legal issues and concerns. It is not intended to be a substitute for legal advice, nor does it tell you everything you may need to know about this subject. Future changes in the law cannot be predicted, and statements in these materials are based solely on the laws in force on the date of release noted on this page.

This document is for non-profit educational purposes only. This document may not be used by a profit-making company or organization. When used by a non-profit organization, appropriate credit must be given to the Cooperative Extension Legally Secure Your Financial Future: Organize, Communicate, Prepare education program. Materials for this program were developed by a team from six land-grant universities. The program is included in the program toolkit of the Cooperative Extension Financial Security in Later Life national initiative. For more information go to: http://www.csrees.usda.gov/fsll.