Estate Planning and Joint Accounts

Joint accounts are a popular estate planning option. This is because they often allow for a quicker transfer of assets to the joint owner at the time of death. As the surviving owner of a joint account, a person takes complete ownership after proving the death of the deceased joint owner. When the joint owner dies, there are often estate and inheritance tax consequences that are related to inheriting a joint account.

Joint accounts are used commonly in a marriage because spouses already share their assets and will pour all income into one account which they can both use. Oftentimes spousal transfers are easier than others, especially in states that honor community property proceedings. If your spouse passes away then you need to contact an attorney to help you learn how to transfer all joint accounts into your name alone.

If the joint owner of the account is your spouse, then half the fair market value of the entire joint account will be included in the decedent's estate. If the joint owner of the account is someone other than your spouse, then the fair market value of the account will be included in his or her estate. After you determine how the account will be divided among owner's estates, it is important to learn how the taxes will be determined. There are normally taxes associated with every account transfer.

If a joint owner of an account dies intestate, and his over her estate is subject to estate and inheritance taxes on a federal or state level then state law will determine whether or not the inheriting spouse is responsible to pay for the taxes. If the property owned jointly is physical real estate, then the law of the state in which the property is located will control the taxes on the property. If the property was owned jointly but was not real estate, the law of the state where the deceased owner died will control the taxes on the property.

If the deceased joint owner dies with a will, then his or her estate is object to inheritance taxes as issued on the state or federal levels. The apportionment of the tax will be depending on the provisions that are contained in the Last Will and Testament or the Revocable Living Trust. This is why it is very important to hire a probate attorney to help you as you create your will and work through your case.

The right professional will be able to help you draft your will in a way that avoids some taxes and helps to conserve your state so that your beneficiaries can get the maximum amount. Normally, a joint owner on an account is not required to pay any of the joint owner's final bills. This is true unless you co-signed or personal guaranteed one of the decedent's debts for some reason, and are now being held responsible for that expense.

If there is a debt that you are not sure about, then you need to talk with an attorney immediately for more information. With the right attorney on your side, you can get the financial guidance that you need. Use this directory to locate a probate professional near you today for more information and to get the helpful advice that you need whether you are creating a will for your future beneficiaries or dealing with your decedent's fortune and are not sure how to handle joint accounts.