What are the steps that need to be taken when a minor is named as a POD Beneficiary; and the beneficiary is under the age of 18 at the time of payment?

Someone is going to have to go to court and be appointed the minor's custodian for the funds and bring the proof to you prior to cutting a check to "xxxxxxxx custodian, FBO minor".

Custodians do not need to be appointed by a court in Wisconsin. A parent or any other competent adult can serve as one. The check would be payable as Randy stated above.

Custodians do not need to be appointed by a court in Wisconsin.

Really, for an inheritence??? Never heard of that one before, but I'm not totally up to speed on WI law.

Wis. Stats. 54.854 covers Custodians, if you're interested in some Friday afternoon reading. A transfer to a person qualified as a custodian for the benefit of a minor creates a custodial relationship.

If a minor is named as a POD beneficiary, the verbiage should be:

Individual accounts:
[Name of Minor], but if he/she is a minor on the date of my death, to [Name of Adult] as custodian for [Name of Minor] under WUTMA.

Joint accounts:
[Name of Minor], but if he/she is a minor on the date of death of the last surviving depositor, to [Name of Adult] as custodian for [Name of Minor] under WUTMA.

If the POD is still a minor as of the date of death of the depositor, the funds must be placed into a WUTMA. If the named custodian does not want to open an account at your FI, simply write the cashier's check to [Name of Minor] by [Name of Custodian] (or any other similar wording).

If that previously named custodian is unable or unwilling to act, and the minor has attained the age of at least 14, the minor is able to name his/her own custodian per WI Statutes. If the minor has not reached the age of 14, typically the guardian/parent of the minor is the custodian. I'm not sure they need to go to court to have themselves designated as custodian, though.

I have read that section. Can you point out to me where is says that the bank can pick and choose who to turn this money over too? The Bank is not a executor of the estate and this by passes any will. You going to give it to the first relative that shows up at the door? Father, mother, step mother, step father, etc., etc.?

Kerry G appears to have it right.

Kerry - actually, the Statutes address the picking of a successor custodian - not the original one:

If a custodian is ineligible, dies or becomes incapacitated without having effectively designated a successor and the minor has attained the age of 14 years, the minor may designate as successor custodian, in the manner prescribed in sub. (2), an adult member of the minor's family, a conservator of the minor or a trust company. If the minor has not attained the age of 14 years or fails to act within 60 days after the ineligibility, death or incapacity, the conservator of the minor becomes successor custodian. If the minor has no conservator or the conservator declines to act, the transferor, the legal representative of the transferor or of the custodian, an adult member of the minor's family or any other interested person may petition the court to designate a successor custodian.

After a little more research, if the account is over $10,000 then someone would need to go to court and be appointed. Under $10,000 and it potentually could be a family member. As a bank, unless they want to get embroiled in a family dispute, I would let the courts decide and I would not be relying on the "may be made" qualification in the code.

54.866 Transfer by obligor.

54.866(3) (3)If no custodian has been nominated under s. 54.858, or all persons so nominated as custodian die before the transfer or are unable, decline or are ineligible to serve, a transfer under this section may be made to an adult member of the minor's family or to a trust company unless the property exceeds $10,000 in value.

rachelchri may actually want to visit with bank legal counsel for clarification.

I was referring to the appointment a successor in place of the originally named custodian.

I, however, was not aware of the $10,000 threshold. Good to know!

On the WBA POD Designation of Beneficiary, the account owners name the custodian in the event the named beneficiary is a minor on the date of their death, which matches Kerry G's original answer.

If that named custodian is unable or unwilling to act, a successor custodian would need to be named. This would be accomplished by a conservator being named for the minor through the court.

We had a situation where a 14 yr old girl was beneficiary of her mother's accounts. Mother and father were divorced. The mother passed and the father was trying to claim the funds on the daughter's behalf. Our bank's attorney advised us that even though he was her father, he would need to petition the court to be named conservator in order to claim the funds for her as custodian under WUTMA.

I know this is a bit of an old topic, but I actually stumbed accross the answer when reading statutes (in my spare time).

705.04(2)(f) Payment may be made to a minor P.O.D. beneficiary only in accordance with a procedure approved under ch. 54.



54.12 Exceptions to appointment of guardian.
(1)Small estates. If a minor or an individual found incompetent, except for his or her incapacity, is entitled to possess assets valued at the amount specified in s. 867.03 (1g) or less, any court in which an action or proceeding involving the assets is pending may, without requiring the appointment of a guardian, order that the register in probate do one of the following:
(a) Deposit the property in an interest-bearing account in a bank or other financial institution insured by an agency of the federal government or invest the property in interest-bearing obligations of the United States. The fee for services of the register in probate in depositing and disbursing the funds under this paragraph is prescribed in s. 814.66 (1) (n).
(b) Make payment to the parent of the minor or to the person having actual custody of the minor.
(c) Make payment to the minor.
(d) Make payment to the person having actual or legal custody of the incompetent or to the person providing for the care and maintenance of the individual found incompetent for the benefit of the individual found incompetent.
(e) Make payment to the agent under a durable power of attorney of the ward.
(f) Make payment to the trustee of any trust created for the benefit of the ward.

54.12(2) Informal administration. If an individual found incompetent, except for his or her incapacity, a minor, or a spendthrift is entitled to possession of assets of a value of the amount specified in s. 867.03 (1g) (intro.) or less from an estate administered through informal administration under ch. 865, the personal representative may, without the appointment of a guardian, do any of the following:
(a) With the approval of the register in probate, take one of the actions specified in sub. (1) (a) to (f).
(b) With the approval of the guardian ad litem of the minor or individual found incompetent, take one of the actions specified in sub. (1) (a) to (f) and file proof of the action taken and of the approval of the guardian ad litem with the probate registrar instead of filing a receipt under s. 865.21.

We are not talking about the adminstration of an estate. A POD account bypasses the estate.

Ch 705 that covers POD payouts directs you to Ch 54 that covers estates for handling of payouts to minors.

Regardless, I would still hand the money to the courts to adjudicate and not involve the bank in the interpretation of State law.

I'd like to restart this to see what other Wis banks are doing in case no custodian was ever named for a POD minor. Are you requiring the court documentation for proof of who the named custodian should be?