Florida Estate Planning Lawyer Blog
As loved ones age, they usually require assistance with their everyday lives, including managing their money. Most people work around this by adding a family member to their account or setting it up as a convenience account. While both accomplish the same goal, they have slightly different impacts on the account and how it is treated after the original owner has passed.
The designation of convenience accounts comes from Section 655.80 of the Florida Statute. The statute allows an account’s owner (principal) to designate an agent. The agent is a person who has the authority to withdraw, deposit, and manage from the account while not assuming any of the account’s liabilities. The agent is only granted access to the funds and has no ownership of the account. The impact is that when the original owner dies, the agent’s authority is terminated, and the account is treated as only owned by the principal. This means the account will be governed by the owner’s wishes and estate plan. The real-world impact is that the family member helping the parent doesn’t get to keep the account after the owner dies. The leftover money will be divided according to the owner’s estate plan.
Meanwhile, with a joint bank account, the added individual now owns the account. This impacts several things, including how the account will be treated when one of the owners passes. In a joint account, when one owner passes away, the account passes to the surviving owner automatically and in the survivor’s name only. Florida Statute 655.79 states that unless there is some expressed writing in the opening or maintenance of the account, an account with joint owners will be presumed to be a joint account. This means if you intend to add someone to an account just to help out and not to have any ownership if chosen to be owned jointly, that added individual will now be an account owner. Section 655.79 has an exception to this presumption by “clear and convincing proof of a contrary intent.”