Can A Person Be Sued For Taking Money From Joint Account

24 Nov Joint Banking company ACCOUNTS – A Approving OR A Curse? 9 REASONS TO NOT Utilise A Articulation ACCOUNT

Articulation banking company accounts can be helpful in several means, but such accounts can also exist a trap for the unwary. A couple of the major benefits are equally follows:

1. Trusted joint account owner can pay your bills. Probably the most common reason for opening such accounts, your articulation account owner (typically a spouse or a child or other trusted individual) tin pay the bills or make deposits on behalf of other owner. Sometimes financial powers of chaser are not accepted by financial institutions, only a joint account owner can do anything with the account (bold no restrictions such a requiring two signatures).
2. Probate avoidance. Unlike individual accounts, joint accounts can avoid the legal procedure of going to court to make up one's mind if a Will is valid or determining the heirs if there is no Will and determining who has the power to pay bills.

However, there are numerous reasons or risks that should exist considered before you open a joint banking company account including, without limitation, the following:

1. Creditors of articulation account owner. If your joint bank account possessor gets sued or has other creditor issues, your account could be at risk. There are ways to protect your casher from their creditors after you die with proper planning.
2. Articulation owner gives authority to someone else. The joint account possessor could have a financial power of chaser that gives authority to handle all of the joint account holder's accounts. For example, yous make your child as a articulation business relationship owner and the kid has marital issues. Does it carp y'all that the son-in-constabulary or girl-in-police force could have access to your account since they could be named as agent nether the power of chaser of your kid?
3. The joint account owner becomes untrustworthy. One of the most common forms of elderberry abuse is fiscal corruption from family members. For example, a parent with macerated capacity trusts a child who uses the account for the child's own personal proceeds. Furthermore, often a parent trusts the "in town" child to have intendance of all of the other children equally with the funds in the joint account later the parent dies. That obligation is strictly moral and not legal.
4. The joint account owner changes your disposition pattern or has unexpected obligations. Even if you trust your spouse (if spouse is a joint business relationship possessor) that the joint account funds would be disbursed the style you lot want, it is possible that your surviving spouse could remarry and could be obligated to pay the bills of the new spouse. For case, your surviving spouse remarries and the new spouse has health issues such every bit long-term costs. Since a spouse has a duty to back up their spouse under state police, the articulation business relationship funds could be used to pay the new spouse's nursing domicile care costs. Of class, if your spouse remarries, they can exercise anything they want with the funds that they own – including giving the assets to their new spouse (instead of your children or other beneficiaries that yous desired).
5. Public benefits problems. Since public benefits such as Medicaid are "ways-tested" (the regime looks at your avails prior to giving you benefits), joint banking concern accounts could be problematic for achieving eligibility. For case, if the joint account holder also contributed to the business relationship, they will have to prove all of their contributions and what was "theirs" as Medicaid will assume the entire account was that of the Medicaid applicant and could only be used for the bidder or else there could be a penalisation resulting in Medicaid ineligibility.
6. Financial aid issues. If you name your child a articulation possessor and their kid'southward (your grandchild'south) college financial help is dependent or based on your child's lack of assets or income, your grandchild might lose eligibility for fiscal aid.
7. Probate avoidance not achieved due to unexpected events. As indicated above, one of the main reasons that articulation accounts are used is to avoid probate. However, if the joint business relationship owner (i.e., your kid) dies first, so the account becomes an individual account and is subject to probate. Furthermore, sometimes you may think you have a articulation account, but it is ready in a way that probate is required (i.e., tenants in common accounts).
8. Joint owner is disabled at the fourth dimension of your death. What if your joint account possessor is mentally disabled at the fourth dimension of your death and doesn't have capacity to handle funds? Will guardianship be needed? Volition their public benefits be jeopardized?
9. What if someone is needed to collect payments due and settle claims and you pass without a Volition or Trust? A joint account gives no authority to the other articulation account owner to collect on assets due to the deceased owner or settle claims of the surviving joint account. And so, sometimes it is best to have a Will and probate so an executor can human action. A Trust would give the trustee authority to act on behalf of the Trust whether the trustor is either dead or disabled. Trusts avoid probate. Powers of chaser stop at the death of the master.

Although setting up a joint business relationship is oft useful, if any of the nine reasons above (and there are more not mentioned) are a concern, so planning (i.e., the utilize of various trusts, etc.) should be considered to insure that you protect yourself and those you desire to protect even afterward y'all pass.

If interested in learning more, consider attending our side by side free "Manor Planning Essentials" workshop by calling usa at (214) 720-0102 or sign upwards by clicking here.

Source: https://dallaselderlawyer.com/joint-bank-accounts-a-blessing-or-a-curse-nine-reasons-to-not-use-a-joint-account/

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