How A Joint Account Is Treated At Death

Sarah J. Randall

Author: Sarah J. Randall

POST DATE: 6.20.16
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Suppose your Last Will and Testament leaves your estate to your three children in equal shares, but you add only one of your three children to your checking account as a joint owner…  How will that checking account be disbursed upon your death? 

Indiana Code Sections 32-17-11-17 and 32-17-11-18 govern the ownership of joint bank accounts.  Section 17 states that during the joint owner’s lifetime, the joint account belongs to the parties in proportion to the net contributions by each – unless there was an obvious contrary intent at the time the account was opened. Section 18 states that anything remaining in a joint account upon the death of a party to the account belongs to the surviving party unless there is clear and convincing evidence of a different intention at the time the account was created or the bank was notified in writing of a change in survivorship. Section 18 also states that a Last Will and Testament cannot change the right to survivorship in statute or contract.

The Indiana Court of Appeals recently had the opportunity to address this issue in the Matter of the Supervised Estate of Ralph E. Herin, Beth M. Herin and Belinda Herin McIntyre v. Stephen E. Herin.  2015 Ind. App. LEXIS 491 (Ind. Ct. App. June 29, 2015).  In 2011, Ralph Herin added his son, Stephen E. Herin, as a joint owner of four certificates of deposit at the bank.  Ralph Herin died in 2013.  Following his death, Mr. Herin’s daughters contended that the CD’s should belong to the Estate rather than to their brother.   The Court of Appeals held that the daughters had the right to prove by clear and convincing evidence that there was a different intention at the time the account was created to not leave the sum on deposit at death to their brother.  Absent said clear and convincing evidence, the account belongs to the surviving joint owner.  In the Herin case, the daughters of the decedent failed to show that their father had any contrary intent when he added their brother as a joint-owner of the cd’s.  Therefore, the cd’s belonged to the decedent’s son, Stephen E. Herin. 

When you are updating your estate planning documents, be sure to keep in mind that any jointly owned accounts will pass to the surviving owner regardless of what your Will provides.  If your intention is to have your jointly held account pass to your beneficiaries in accordance with your Last Will and Testament, then you should consult with your attorney on how best to achieve that goal.   

If you have not yet had the opportunity to discuss your estate planning needs with an attorney or would like your existing plan reviewed and updated, please contact us to schedule a free consultation.

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