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Home >> Special Situations >> Powers of Attorney
Joint Owner or POA, Which is Better?
My ninety-one year old friend designated me years ago as POA and her sole heir. She has a few CDs, a savings account and a checking account. Should she add me to her checking account as joint owner to avoid probate upon her death? Currently, I am on the checks as POA, but we were worried about taxes, etc.
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 As you have noted, joint ownership avoids probate, but it gives ownership rights now, as opposed to after death. Your power of attorney will become ineffective on your friend's death.
We can't give you tax answers, so if they are a concern, talk with a qualified tax advisor. Your friend might also inquire of the bank about the features of a "payable on death" or "Totten trust" account, which might provide a route around probate, but not give any ownership rights until after your friend's death. There are several routes your friend can take, and she will need to decide which she believes best.
Published on BankingQuestions.com 2/18/10
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