Bank won’t release MILs money to executor. Is this legal and correct?

Also my husband changed MILs address to our address and her partner got very nervous when we told him! He wanted to know why and he said she’s not going to get any more mail except a few utilities that he hasn’t been able to put in his name yet. Yeah right buddy. There’s no reason for her mail to go to him and she might be dead but mail
Doesn’t just stop when you die!

Get the bank statements. Account with SIL's name on it now belongs to her just as other account with buddy's name on it belongs to him.

Lost insurance? Check missingmoney website.

Or try www.eapps.naic.org/life-policy-locator/#/welcome.

Thank you! Will the credit union give us past statements for the 2 accounts she was the sole owner of? We don’t have her online banking info. Her partner didn’t give us any bank statements and I am almost positive he destroyed them. He says he destroyed her cards and checks before she died. She has no outstanding debts, we just need to buy a headstone and pay her taxes for 2018, the trusts taxes and probably legal fees. My SIL is going to take the money out of the account she now owns and it will be combined with the money from the other 2 accounts, she knows what MIL wanted. The only one who will potentially be a problem & not be willing to share the expenses here is my BIL.

I told my husband 2 or 3 weeks before she passed, that since he had a durable POA, he should talk to his mom and take control of her accounts. I don’t mean he should have actually done anything with them, I just thought it would be a good idea get all the information on all her accounts so that when she passed and the time came to take care of the estate, he would know where all her accounts were, what was there, and most importantly, he could monitor them and make sure no one was helping themselves to her money while she was on her death bed. As usual he didn’t listen to me! She also had a joint checking account with her partner but thank the Lord, her SS and retirement were direct deposited into her personal account not the joint account. So he now owns the joint account and whatever she had in there and that’s not a problem. I just wish he had gotten all her personal banking info before she died.

worriedinCali, sounds like a complicated situation. One question I can answer is yes, the credit union is correct in not turning that account over to a trustee, executor, or anyone else except the three people MIL named as beneficiaries, aka "payable on death" or POD. Naming PODs on financial accounts is a common estate planning tool that bypasses probate and is much simpler and easier to update than are wills and trusts. Good luck with everything else in resolving this situation.

Gladimhere, thank you so much for those links! We just put in a request to have the insurance companies search their records.

Thank you bicycler. I figured that was the case. It’s not a big deal but it does further complicate things. The whole point of the trust was to a)avoid probate & the 3 kids fighting amongst each other and b)make it easier for my husband to gather all her assets, pay her final expenses and split the remainder 3 ways. She was very specific in the trust in how she wanted things distributed. She just failed to tell my husband that the 3 kids were named as POD benificiaries. It was an oversight, she probably did it when she opened the accounts. The account with my SILs name, her and my husband thought it wouldn’t be a problem and that my SIL could always close it and withdraw the money and that’s what is going to happen. Her other assets, aside from the rumored $20k life insurance, were her retirement and deferred compensation and those won’t be paid in a lump sum to the trust since each kid is a beneficiary.

Let me share my wife's experience with her mother's trust, two CD's that was POD to her and her sister as well as a life insurance policy that they were the beneficiaries of plus two gifts designated by the will to each of them.

The executor is in the process of getting the trust together by gathering all of my MIL's assets in various banks plus the profit from the sale of properties. However, there were 2 CD's that named my wife and her sister as POD that did not go into the trust, but went to them. The same was true of the proceeds from the Life Insurance policy which were designated to them. Likewise, an amount stated in the will is not going into the trust either because the will says that their mother wanted each daughter to be given an amount immediately from her assets.

So, POD's, life insurance beneficiaries, a directives for money like my MIL's will stated rightly go where they are designated to go and do not go into the trust. This is standard procedure.

Why is your BIL likely to be a problem?

Does it look like there will not be enough money in the trust to pay her final expenses?

What’s in the trust? Does the trust have any assets?
You mentioned that your hubs paid the trusts taxes, so is there nothing titled into the trust that makes $ / provides an income stream for the trust? So your hubs he’s the sole trustee as well as the executor for whatever assets outside of the trust?

Worried, a financial account that's held jointly with owners and/or is POD or with rights to the survivor will NOT be funded into the Trust. In order to do that, the account has to be titled "Living Trust for MIL, dated ________," something like that. The specific name of the Trust has to be the name of the account, identifying MIL as Trustee, and also identifying the Successor Trustee.

Titling or retitling in the name of the Trust is part of "funding" the Trust.

The only thing my MIL actually turned over to trust was the house. The deed was changed when she did the trust and the deed is in the name of the trust. She had no CDs that we are aware of. She didn’t tell my husband about them, he received no documents. She didn’t have much, just a few bank accounts, a small deferrred compensation and her PERs retirement. The will and trust said my husband was to handle everything and split all the money 3 ways, so that’s why the bank account issue threw us for a loop. The trust stated that her kids got the money in the bank and her retirement and deferred compensation and any life insurance policies and it was to be split 3 ways.

He hasn’t paid any taxes yet. She passed June 1. On Friday he decided to take advantage of the few days his employer gave him of to start gathering all her accounts & reporting her death to PERs & social security. The plan was to consolidate whatever money he could, consult the lawyer & accountant, use her money to pay whatever fees they charge, get estimates for the cost of filing her tax return & the trust tax return, set money aside for that and then split the remaining cash 3 ways.

There is another savings account at a different credit union and it has my husbands name on it as co-owner. It doesn’t have much in it and it’s where the funds for her funeral expenses came from. I don’t know how much is left but if it’s not enough to cover the taxes and any other final expenses that come up, my husband would have to ask his siblings to help out. I don’t think it’s fair that we would have to pay these expenses ourselves. My SIL is a reasonable person and would have no problem helping out. My BIL on the other hand, has never contributed anything when we all pitched in money. He’s the one who has had financial problems in the past and is just never willing to pitch in. There is a reason my MIL did not make him 2nd backup as her durable POA. I know my SIL won’t be an issue because when my husband called her explained the situation with the account her name was on, he said if mom said that money was for her only then to go ahead and take it for herself and she said it wasn’t supposed to be just her money.

Worried, in my experience, the attorney who drafts the trust provides information to the family on how to "fund" the trust. Then it's up to the family to do that.

Some attorneys might handle that for the family, if requested; I suspect it's not unusual for an attorney to do that...in fact, I remember now that when my sister executed her estate plan, she was also in a terminal state and our attorney handled the funding b/c we were preoccupied with her health and whether or not she'd live to the next day. And the Trust needed to be funded ASAP so the assets were already in it before she passed.

Is your husband familiar with filing the Trust tax return, the form 1041? If not, consider getting accountant help. I struggled with the first 1041 I filed and finally found a trust accountant to help me. After he did it, I realized I had been making too much of a complicated project (other than preparing the K-1s) and confusing myself.

I think though that your husband would be wise not to split the funds between the heirs and disburse them before filing the final returns. If he's short on money, even with an estimate now, the funds have to come from somewhere.

Most Wills and Trusts also require that the expenses of the last illness must be paid before any distributions are made. Query if final taxes are functions of the last illness? I would say so. He'd be more in compliance with the Will and Trust terms if he didn't make the distributions yet.

No need to be rude shakingDustoff. You can leave with that attitude, it’s not needed here, got it? Nobody asked you for anything. I never asked you or anyone else to weed through anything and there isn’t anything to be wedded through here, it’s a pretty simple estate. i simply asked about the bank and the POD. So you can get over yourself and your $270 fee. I already stated we have an attorney and an accountant and they will be called tomorrow. This type of forum really isn’t the place for your antics, you don’t need to come in acting like someone asked you for something when they didn’t.  so again kindly avoid my posts. You aren’t welcome on them. 

MIL had beneficiaries named on her account it would go to them. The money in the account is split equally, in this case 3 ways (with interest). Reason you can't close it out for them, is the money is taxable. CU should have offered the option of the heirs submitting their SSN and CU sending them the paperwork to close the account. That way, CU when they would get back the necessary documents, would mail them their checks.

Thank you shad. It was my understanding that the money is taxable as well. The CU did not say anything about that though. They said they prefer all 3 siblings to come down at the same time, sign something and they will each be cut a check but if they weren’t all able to go at the same time, they could come in individually. They made it sound like only one person has to sign paperwork and it can be any of them. They have all decided to wait on that until after my husband meets with the lawyer. Anyway thank you all for the advice & sharing your experiences!

Money received from my mom was not taxable. Accountant said it is taxed to mom. And taxable by heir if over two million?

I'm also wondering why it would be taxable. I would think it should be calculated as income, but whether or not it's taxable would depend on the individual's income level and AGI. But I don't think it's taxable as an inheritance, unless the individuals are in the higher tax bracket for inheritance taxes.

Going through this with my mom's estate right now. What is taxable as income ( my understanding) are monies that were in tax deferred accounts and left " to the estate of". Those monies are distributed to the heirs and we pay income tax on them.

If mom had left those account to us as beneficiaries, then the estate would have paid the tax.

To shaking...my hourly fee is on a par with yours. I feel no regret in sharing my expertise.

I always wonder at folks who trumpet to the skies their " Christianity" and then have no impulse to act like Jesus and give away, if not the cloak off their back, then just a bit of advice. You really give Catholics a bad name, my dear. Get some help, would you?

None of us are in a higher tax bracket for inheritance tax and well below the 5 million inheritance exemption limit. Being in California, I just assumed, maybe incorrectly, that on our state return, we would have to count this as taxable income. I know we don’t have to pay estate tax or inheritance tax. It’s just hard to believe that a state that taxes just about everything, would allow us to receive this money tax free? Between the bank accounts, there is approximately $35,000 maybe a little less. Assuming $5k goes to the headstone, legal fees and taxes, each kid would get $10,000. For it to be tax free in the state of California, it just seems too good to be true. I’m sure the lawyer and accountant can tell us what exactly will be taxable. The PERs retirement I understand will be taxed 20% for federal taxes. I assumed, and again probably wrongly, that the CU would send everyone a 1099 at the end of the year. But if this money will be tax free, yippee!!! We would normally get a nice tax return but I don’t think we will get anything back next year because of the tax we have to pay on the PERs money. We’ll probably end up owing taxes but we’ll hash all this out with the accountant. I’m hoping we can make estimated tax payments this year rather than get hit with a big bill when we file next year.

And I am sorry for my outburst! I was out of line. Emotions got the best of me. I just think if you don’t want to answer a question or be helpful, why announce it? It does nothing but make you look like a jerk in my honest opinion! I am so greatful for all the advice, insight and support I have received. I will pay it forward as much as I can.

I look on the wrapping up phase as being the aftersales service part of caregiving, Dusty.

Worried, I hope this weblink might be helpful? - www.courts.ca.gov/8865.htm

Dusry, Worried lost her MIL about a week ago.

Wrapping up an estate IS part of caregiving and is sanctioned by the admins on this site.

I'm sorry your mother has been ill and that you have no help.

Is "flipping over tables" a reference to your Christ-like behavior?

I see.

I just to make sure everyone else understands what you're referring to.

worriedinCali

You're welcome. Maybe taxing of the funds is different for each state. When closing out my mom's CU account, the lady did mention if I wanted to have federal taxes taken out before she cut the check or I could do it when filing taxes. She also sent the forms to my brother who was out of state. Once she received the documents back, she cut and sent him the check. This is in OH by the way.

Worried, this isn't the first time ShakingDustOff has exploded and argued with other posters. This was the behavior exhibited a few years back; it became so persistent and offensive that posters were actually telling her to leave. Now she's back.

Thank you shad and garden!
My husband spoke with our accountant this morning and the money from the accounts in his name and my SILs name is not going to be taxed. I don’t know about her personal accounts. A call to MetLife shows she did not covert her employer-provided life insurance when she retired. Her partner as of Saturday still says she had a few policies for the kids.

Things have taken a serious turn now, with her partner. I will probably document this here as it plays out. Something shocking just happened. I have made no secret of the fact that I don’t trust her partner one bit. He has told a lot of lies. He had told me he made $70k over a 2 year span when he worked as a courier and got paid under the table. I think this was 2014-2016. Maybe 2013-2015. He claims, and still claims, it all went towards paying off the house. Anyway! On Saturday night we went over to the house to get the new grant deed and he told my husband he made $90k under the table when he was a courier. That’s $20k more than he had told me in the past. During the conversation, in which he rambled and seemed to be covering tracks, he said that most of MILs money had gone to her medical bills. I was immediately suspicious because he had told me many times that her insurance (Medicare and she kept her private insurance after she retired) covered everything. The day she died, he pulled his insulin out of the fridge and proudly announced that it costs $175 but he only paid $4 at Walmart. He always did that kind of thing. So his comment stuck out to me and my spidey senses went off. So today I realized that if she had really had all these medical expenses, my husband should get the receipts so the expenses can be written off when we dinher taxes, she only had an income for 5 months this year so it’s possible there were enough out of pocket expenses that we can write them off. She has no other deductions to write off and had to pay taxes for 2017 when she filed, we are just trying to avoid her owing taxes for 2018. Anyway so my husband just called MILs partner to ask about her medical bills and for copies for tax purposes and her partner said there were no bills! Everything was taken care of by the insurance!!! So Saturday he said she had a lot of medical bills she paid and today he said there were none!! I about fell out of my chair when he said that! More lies! This guy is a very smooth talker let me tell you. He’s good. I am surprised he lied to my husband though. He must not be as smart as I thought! So my husband’s spidey senses are going into over time now and her partner better be prepared. My husband is in law enforcement was a detective for 5 years, some of that was dealing with financial crimes so.....it seems impossible we can prove anything but I do believe he is going to try to gather as much information as he can because clearly this guy is up to no good. He got very nervous when he found out we changed MILs address to our address. He also went on and on about how MIL wanted him to have half of everything but he always told her no, to leave it to her kids. This is a direct contradiction to when he told me sometime in May that she was very angry at him and had been for a long time (I assumed it was because of his IRS fiasco, getting caught working under the table) and she didn’t want him to have anything and she wasn’t leaving him anything. But on Saturday he was going on and on about insurance policies and her PERs and how she wanted him to have half of it. I don’t buy it. I’ve been in this family for almost 20 years and her kids have always always always been her beneficiaries. Always. The one thing people remembered her for when they speak of her now is how dedicated she was to her children. He was nervous the entire time we were there and he also said she recently paid him back the money he put towards her car, the one we were given. I don’t believe him because of the conversation last month where he said she was angry at him and didn’t want him to have anything. There was also an incident where he called me upset and in a panic because supposedly the IRS claimed they never got his $6300 check, that he had mailed a smaller payment to them along with a $6300 payment and they were claiming they never got the bigger check and he needed me to stay with MIL while he went to the bank. I thought, and still do think, that he went to the bank to take MILs money to pay his tax bill. If he put all his money into the mortgage there’s no way he had $6300 saved up. He hasn’t worked in a couple years and he claims when he sold his truck for $20k he turned around and paid it towards MILs new car. But I do think it’s reasonable to assume he took money from her checking account because there was only $6,000 there. Her social security and PERs went to her personal account and she had just gotten paid 2 weeks before she died. Her SS was $1700 and PERs was $2300 I think, maybe a little more. So before she got paid for May, she had $2,000 in the bank. Other than what she paid for her plot on march 3rd, she should have had no expenses! So what happened to March and April’s income? My husband is going to get statements from the bank. If he took the $5k funeral home bill from her account, he had no right to do that. It was supposed to come from the joint account that he know owns. We couldn’t legally enforce that but this were her wishes and legally he was not allowed to take money from her personal accounts! So my husband has to run everything by his siblings later and decide where to go from here.

I meant to say that when she passed away, her checking account had only $6k. If there really were no medical bills, she should have had at least $8k alone which were March and April’s income. She was very frugal and her only other expense besides the plot, was her tax bill. She should have had more than a total of $12k in her 2 personal accounts since she had been basically home bound since thanksgiving. The money she spent on Christmas presents came from the account with my husbands name on it, every year she pulled a $1000 out for Christmas shopping.

One thing I think I would do is notify the 3 credit bureaus of her death and ensure that he doesn't use any credit cards she might have had.

I wonder if you'll ever really know how much he might have pilfered from her accounts. I suspect he was adept at covering his tracks. But since your DH is a detective, you and he might want to have some discussions about what you really can do, can find out, and what to do to stop him from any further financial abuse.

As I recall he could live in the house after she passed? Do you have her possessions out of there yet? I know it's only been a short time though.

It's really challenging when complications like this follow the loss of a loved one. That's difficult enough w/o having to worry about someone's misuse of assets.

My husband is going to do some digging & see what he can find out and piece together.

He’s already gotten rid of most of MILs stuff! That’s another issue. He had NO right, not morally and not legally, to get rid of her stuff! Her trust says he can stay in the house the remainder of his life and he cannot bring in a non-blood relative, and that he is responsible for all expenses and can have all household items. Her personal belongings were left to the kids and the executor is in charge of distribution. Well this guy has been getting rid of her stuff for weeks now and almost everything is gone! My husband is not happy about that and he wanted to tell him to stop it right now but he talked to his sister day and it sounds like he’s already rid of almost everything. My SIL was upset that when she went to pick out the dress MIL was to be buried in, she discovered he had donated most of her clothes! This was like 2 days after MIL passed! But she also sympathizes with him and knows that he deals with things by getting rid of stuff. But that still doesn’t make it ok! It may have been junk to him or stuff he didn’t want, but somebody else might have wanted it! I think since my husband doesn’t have the support of his sister, he is going to let this go. I know something came up over MILs mobility scooter, she used it one. Her partner claims he paid for it. He sold it before she died or says he did, for $1000 and my husband thought it should go to the trust. But SIL brought up that he was her primary caregiver and changed her diaper. I’ll give him that but he wasn’t the best caregiver and there were signs of neglect showing not long after she was confined to the hospital bed and that is why the home health aid started coming 3x a week and the nurse coming 2x a week. I know it was a hard job and he did take care of her but he is no saint, he let her suffer. But anyway my point is, most of her stuff is gone and we were not given the chance to go through it first and take what we wanted. He did give all of us a few things here or there and say she wanted us to have them but we know she didn’t. I think my SIL ended up with the most Out of all 3 kids.

MIL has been gone 10 days now. Or is it 11? And he’s cleaned out the whole house and gotten rid of everything already :(

Adding for documentational purposes since I will be revisiting all my posts & writif down the dates he made certain statements—

On Saturday the 9th when we picked up the deed to the house, he made a statement to my husband that were was a large medical bill he had to pay and that all MILs money had gone toward medical expenses. And then like I said above, when my husband called to get the bill and the bills already paid, he was told that she had no medical bills, insurance took care of it all!

I am a bit disappointed that when told of this, my SIL said it’s too soon and to give him the benefit of the doubt for now and that she doesn’t think he’s trying to rip anyone off but she does think he’s looking for ways to get money. He’s got her fooled. It’s really not about the money, it’s the suspicious behavior and the lies and getting rid of her stuff when he had no right to.