Category: Stocks

The Moneyist: My mom added me to her bank accounts before she died. Am I legally or morally obliged to disclose these accounts to my siblings?

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Dear Quentin,

My mom recently passed away.

I have taken care of my mom’s finances for the last 10 years. It was always her money, but I made sure all her bills were paid. She lived in her own house until about 7 months ago. She then moved in with me. She was 89 years old and could not take care of herself any longer.

Do I need to report this to the probate lawyer? More importantly, do I need to tell my 3 siblings about the money in these accounts?

For the last 10 years, I have taken care of paying her bills, so mom put me on all of her checking/savings accounts. My mom trusted me to take care of all her finances as well as all aspects of her life/care, and any house repairs/problems.

As I am joint on her banking accounts, do I need to report this to the probate lawyer? More importantly, do I need to tell my 3 siblings about the money in these accounts? If I am joint on her accounts does that make me the beneficiary, and does it need to be disclosed?

My sisters are bugging me about mom’s accounts. I haven’t told them anything. Mom didn’t want me to talk to them about her money, and I never have until now. What should I do? Am I legally bound to disclose the accounts?

Thank you for your advice.

Daughter/Sister

You can email The Moneyist with any financial and ethical questions at qfottrell@marketwatch.com.

Want to read more?Follow Quentin Fottrell on Twitterand read more of his columns here.

Dear Daughter/Sister,

I’m sorry for your loss, and I am glad you had this time to spend with your mother, and take care of her needs. It’s not easy, and some families can take such a commitment by one child for granted. You did your mother a great service, and I hope you take solace in the fact that you did everything in your power to make her final years comfortable, and free of loneliness.

You write that your mother “put me” on these accounts and you say “I am joint” on the accounts. First off, establish whether you are a “joint owner” on these bank accounts or an “authorized signer.” There’s a big difference between the two. With the former, you are the beneficiary of these accounts, and they do not go through probate. Not so, with the latter.

‘First off, establish whether you are a joint owner on these bank accounts or an authorized signer.’

— The Moneyist

Let’s proceed on the basis that you are a co-owner. Given the decade-long commitment to your mother and her wish for you to keep the contents of these accounts private, I see no moral or legal imperative to acquiesce to your siblings, and give them a full forensic accounting. To what end? The only reason would be if this was their money too. It’s not.

Still, situations such as this can be tricky. “Transfers on death” are widely regarded as a more secure way of passing on bank accounts to a chosen friend or relative, and can also help avoid tax pitfalls that come with the inheritance of joint accounts. That said, transfers on death do not give third parties ownership during the person’s lifetime.

According to the National Law Review, making an adult child a joint owner of an account is regarded as the “poor man’s will” primarily because of the myriad problems that can arise over whether it was merely a convenience account set up to pay bills, but not actually meant to be left to the care giver in question. “Litigation can, and frequently does, ensue.” It poses three questions:

1. What was the source of the account? “If the deceased owner was the sole source of funding, the account is more likely to be viewed as a convenience account, with the joint designation intended merely as a means to ensure the deceased owner’s expenses were paid while he or she was alive, rather than a true joint account,” the NLR says.

2. What was the money used for? “If the account was used solely for the deceased owner’s expenses, it is more likely to be viewed as a convenience account,” it adds. “The living joint owner’s use of the account, however, is strong evidence that the deceased owner considered the account to be a ‘true’ joint account.”

‘Always err on the side of transparency. That means full disclosure to the probate attorney.’

— The Moneyist

3. And, finally, when was the account set up? “If the account was created long before the deceased owner’s death, it is probably easier for the living owner to argue that the deceased owner knew what he or she was doing, was less susceptible to any influence,” the publication adds. But the opposite could also be true. Therefore, any paper trails to support your case would be useful.

There are a lot of moving parts here. Always err on the side of transparency. That means full disclosure to the probate attorney. He or she can assess all the documents, and ensure that all legal issues are addressed in a fair and proper manner. Your siblings would be less likely, in theory anyway, to suspect that any undue influence or financial malfeasance has occurred.

Hello there, MarketWatchers. Check out the Moneyist private Facebook US:FB  group, where we look for answers to life’s thorniest money issues. Readers write in to me with all sorts of dilemmas. Post your questions, tell me what you want to know more about, or weigh in on the latest Moneyist columns.

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The Moneyist: My sister inherited the family home, but not the contents. She set up a ‘garage sale’ — and key items were missing. Should I pursue legal action?

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Dear Quentin,

My older sister and I are in the process of being appointed co-executrixes of my parents estate through the courts, as their will stated. Dad passed in January 2021. Mom passed in 2019.

For tax reasons, my parents put their home in my sister’s name. After the COVID-safe funeral and while in the process of finding an attorney to handle the estate, I offered my sister assistance to go through the house.

Her response was, “The house is mine.” To which I responded, “Yes, but their possessions are not,” and I referenced where in the will this was stated. (I’m glad I read it.)

‘If two people wanted the same item, we could flip a coin so there would be no hurt feelings.’

I offered an idea that the beneficiaries and their families to go through the house with a pad and pen, and make a list of items they were interested in and, afterwards, the three of us siblings would meet to discuss.

If two people wanted the same item, we could flip a coin so there would be no hurt feelings. I thought it was a fair way to handle a difficult task. The response from my sister: “I’ll think about it.”

Weeks went by, and I received a text from my sister on a Thursday afternoon saying she was ready to let us come to the house, and she asked to let her know what time on Saturday or Sunday we would like to be there. She also asked me to convey this information to my brother.

I expected to walk through my family home. What I found was some of the contents of my parents home setup in the garage, like a garage sale.

Needless to say it was a very unpleasant experience. Many items that I searched for were not there, and I got vague answers about what had happened to them. My brother was outraged, words were exchanged, and he left in disgust. Was this even legal?

‘Many items that I searched for were not there, and I got vague answers about what had happened to them.’

This is the latest instance of my sister doing exactly as she pleases without regard for anyone else involved.

My sister did most of the heavy lifting of caring for my parents, but she never asked for help when it was offered. For instance, I suggested an assisted living facility for them to live in, but I was immediately shut down. She had been there, seen it and didn’t like it, so it was a no.

She has an excellent job making six figures, and a lovely home which is paid off. She is not strapped for cash, but when we started this process, she kept saying, “I have to think about my retirement.” She is 67. I think she is padding her 401(k) with everything she can get her hands on.

I am considering hiring an attorney and filing suit against her. Since my parents’ passing she has tried to cut my brother out of a trust. Again, I told her that the will states that trust beneficiaries will be my parents’ surviving children. I’m not a lawyer, but everything she is doing seems sketchy, and I certainly don’t trust her.

I don’t want to end up in an endless court battle. How would you pursue this? Or would you just wrap up the estate and walk away from a toxic individual?

Respectfully,

Baffled in Boston

You can email The Moneyist with any financial and ethical questions at qfottrell@marketwatch.com. Want to read more?Follow Quentin Fottrell on Twitterand read more of his columns here.

Dear Baffled,

Your sister should have waited for the probate process to be complete before removing — or, indeed, selling or hiding — items from your family home. She has acted beyond her powers as beneficiary of your parents’ home, and in direct contradiction to the terms of the will. Based on the alleged missing items, and her actions around the family trust, she has demonstrated that she cannot be trusted to be co-executrix of your parents’ will.

‘Based on the alleged missing items, and her actions around the family trust, she has demonstrated that she cannot be trusted to be co-executrix.’

— The Moneyist

“The involvement of an attorney and the court system can assist in recovering the stolen or missing items,” according to the law firm Hopler, Wilms & Hanna. “To hopefully avoid taking the matter to court, an attorney can work with the disgruntled family members to create a process to recover the property that was taken and assist in the proper distribution of assets. With family, it is usually best to settle issues as amicably as possible.”

“However, more challenging cases may require the court’s involvement,” the law firm adds. “They can also demand the recovery of the property. This is done by filing a verified petition and having a hearing in front of a judge. During the hearing, which is in all respects a trial, the evidence is taken, and a judge will decide whether the person is in possession of the property wrongfully.”

If you allow her to continue as co-executrix, expect more of the same. She has, in a way, done you a favor by showing her hand. Don’t expect her to act in a reasonable or even legal manner from this point forward. That way, you won’t be surprised or disappointed. Gather a list of the missing items, and any evidence concerning her attempts to remove your brother as a beneficiary of the family trust, and petition the probate court to be sole executrix and/or share the duties with your brother.

Any other legal action should be taken in consultation with your brother, and your estimation of the value — financial and sentimental — of the missing items.

Hello there, MarketWatchers. Check out the Moneyist private Facebook US:FB  group, where we look for answers to life’s thorniest money issues. Readers write in to me with all sorts of dilemmas. Post your questions, tell me what you want to know more about, or weigh in on the latest Moneyist columns.

By submitting your story to Dow Jones & Company, the publisher of MarketWatch, you understand and agree that we may use your story, or versions of it, in all media and platforms, including via third parties.