Frequently Asked Questions About Payable on Death Bank Accounts in Washington

One way to keep your checking, savings, or other bank accounts out of your future probate estate is to register them as “payable on death” (POD) accounts. A POD account is something you need to arrange with your bank or other financial institution where you have an account. While POD accounts are sometimes referred to as “transfer on death” (TOD), they are actually a distinct type of legal arrangement governed by Washington law.

How Does a POD Account Work?

In most respects, a POD account is like any other bank account held in your name. The key difference is that you designate a beneficiary to receive any remaining funds in the account upon your death. This beneficiary must be registered with the bank or financial institution prior to your death. The beneficiary must present the financial institution with a certified copy of the original depositor’s death certificate before any transfer of funds takes place.

Where Can I Use a POD Account?

Under Washington law, POD accounts are limited to “financial” accounts, i.e., a deposit account you maintain with a financial institution. This includes checking accounts, savings accounts, certificates of deposits, money markets, etc. It does not include securities or brokerage accounts or real estate. For those you can set up a TOD account instead, which functions in a similar manner as a POD account.

How Does a POD Account Differ From a Joint Tenancy with Rights of Survivorship Account

A “joint tenancy with rights of survivorship” (JTWROS) account includes joint ownership as well as survivorship rights. For example, if you and your spouse have a joint checking account, when one of you dies, the other automatically becomes full owner of that account. More to the point, while you are both still alive you each have equal access to the funds in the joint account. A POD beneficiary, in contrast, has no right to access or use funds until the account owner dies. And if there are two or more joint owners, all of them must die before the funds are transferred to a POD beneficiary.

Is a POD Account Subject to Probate?

In most cases, no, provided the beneficiary survives to take distribution of the account. A POD account is released to the beneficiary upon death, so it does not need to go through the deceased owner’s probate estate. There is a critical exception, however, under Washington law. The account owner may execute what is known as a “super will.” This is essentially a clause in the account owner’s last will and testament disposing of specific types of nonprobate assets, such as POD accounts. If a super will names a different beneficiary than the POD account, the super will controls.

Can a Beneficiary Designation Be Revoked?

Yes. The account owner retains full control over any beneficiary designation during their lifetime. They are therefore free to amend or revoke the designation as they see fit. And as previously noted, they can also sign a super will that overrides a prior beneficiary designation.

Contact a Spokane Probate Avoidance Lawyer Today

A POD account is just one method of helping to reduce your potential probate estate. If you would like to discuss all of your alternatives with an experienced Spokane probate avoidance lawyer, contact Moulton Law Offices, P.S., today to schedule a free consultation. We serve clients throughout Spokane Valley, Kennewick, and Yakima.