Skip to content
BOL Conferences
Learn More - Click Here!

Thread Options
#1037592 - 09/09/08 03:31 PM ITF Accounts
auditor333 Offline
New Poster
Joined: Sep 2008
Posts: 6
Does ITF have to be in the account title or can we code the account as an ITF with listed beneficiaries on the account setup side. That way the ITF doesn't show up on the customers statements.

Return to Top
Operations Compliance
#1041772 - 09/14/08 04:07 AM Re: ITF Accounts auditor333
BBoyd Offline
Diamond Poster
BBoyd
Joined: Mar 2002
Posts: 2,494
MI
It's my understanding that for proper FDIC coverage, an appropriate beneficiary indicator must be included in the title. This would include "ITF" or "POD." You may wish to check the FDIC.gov site and the "Your Insured Deposits" brochure. Should the bank fail and no indicator be on the account, payout of funds would be substantially delayed - or, worse - insufficient (i.e., the client may not receive all the funds they're entitled to receive).
_________________________
Opinions are mine and never to be taken as legal advice!

Return to Top
#1041813 - 09/14/08 09:08 PM Re: ITF Accounts BBoyd
John Burnett Offline
10K Club
John Burnett
Joined: Oct 2000
Posts: 40,086
Cape Cod
From the FDIC's regulation, 12 CFR Part 330, section 330.10(b):

Quote:
The required intention in paragraph (a) of this section that upon the owner's death the funds shall belong to one or more qualifying beneficiaries must be manifested in the title of the account using commonly accepted terms such as, but not limited to, "in trust for," "as trustee for," "payable-on-death to," or any acronym therefor. In addition, the beneficiaries must be specifically named in the deposit account records of the insured depository institution. The settlor of a revocable trust account shall be presumed to own the funds deposited into the account.


You need to include the "intent flag" in the account title. You don't need to name the beneficiary or beneficiaries there, though. But they must be named in your account records.
_________________________
John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8

Return to Top
#1058331 - 10/03/08 09:16 PM Re: ITF Accounts John Burnett
dg Offline
Platinum Poster
Joined: Jan 2005
Posts: 811
Pacific NW
What about a Revocable Living Trust. Do the beneficiaries need to be listed somewhere on bank records? Would a copy of the trust documents in the file be sufficient?

Return to Top
#1058398 - 10/03/08 10:44 PM Re: ITF Accounts dg
BrianC Offline
Power Poster
BrianC
Joined: Nov 2004
Posts: 6,685
Illinois
We title the account in the case of a formal declaration of a Living Trust
John Doe Trustee
U/A/D MM/DD/YY

(Under Agreement Dated, and the date the trust was executed)
We then retain a copy of the portions of trust document that name successor trustee and beneficiary information)
If a living trust, we can then use John Doe's Social Security number until his death, at which point the successor trustee would need to obtain a tax ID number and the trust becomes irrecovable.
_________________________
Sola Gratia, Sola Fides, Sola Scriptura, Solus Christus, Soli Deo Gloria!
www.tcaregs.com

Return to Top
#1058425 - 10/03/08 11:46 PM Re: ITF Accounts BrianC
dg Offline
Platinum Poster
Joined: Jan 2005
Posts: 811
Pacific NW
That's pretty much the coursse we take also. But is that ok to ensure insurance coverage, if the bene's are just filed?

Return to Top
#1058434 - 10/04/08 02:18 AM Re: ITF Accounts dg
BBoyd Offline
Diamond Poster
BBoyd
Joined: Mar 2002
Posts: 2,494
MI
It's my understanding that if you have a formal trust (Revocable or Irrevocable), the beneficiary names must be in the trust document. If it's an informal trust (ITF/POD), the bank records must contain the information.
_________________________
Opinions are mine and never to be taken as legal advice!

Return to Top
#1061068 - 10/08/08 06:17 PM Re: ITF Accounts BBoyd
John Burnett Offline
10K Club
John Burnett
Joined: Oct 2000
Posts: 40,086
Cape Cod
And the trust document need not be in the hands of the bank, if the FDIC can obtain it from the trustee.
_________________________
John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8

Return to Top
#1063217 - 10/10/08 07:42 PM Re: ITF Accounts auditor333
Auditor9 Offline
Member
Joined: Jun 2008
Posts: 73
UPSTATE
Can we us a passbook labeled ITF for collateral on a loan for the owner not the peson ITF

Return to Top
#1063218 - 10/10/08 07:42 PM Re: ITF Accounts auditor333
Auditor9 Offline
Member
Joined: Jun 2008
Posts: 73
UPSTATE
Can we us a passbook labeled ITF for collateral on a loan for the owner not the person ITF

Return to Top
#1064389 - 10/14/08 11:58 PM Re: ITF Accounts Auditor9
John Burnett Offline
10K Club
John Burnett
Joined: Oct 2000
Posts: 40,086
Cape Cod
Check your state laws to be certain that the owner has the absolute right to revoke the ITF designation at any time prior to his/her death, and that the designated beneficiary has no claim to the funds unless the owner does die without changing or removing the designation. If all that checks out, I believe you can treat the account just as if it had no designation of a beneficiary at all. I do recommend, though, that you get the owner to sign an acknowledgment that the pledge of the passbook/account takes precedence over the ITF designation.
_________________________
John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8

Return to Top

Moderator:  Andy_Z, John Burnett