I would like to gather examples on how other institutions deal with the death of an IRA owner.
• What they consider proper/official knowledge of death?
• Do they automatically close the decedent’s IRA and open BENEF IRAs for the Benes (I believe this is what is commonly done in order to properly generate tax notices without manual process)
• Do they routinely reach out to beneficiaries or do they wait for Benes to contact us?
• If they do this closeout automatically without contact from the beneficiaries, what do they chose for IRA terms/rates?
• How do they handle the new IRA agreements without Benes signatures?

* A death certificate should suffice in all circumstances, but it is often not required in small towns where bank employees have actual notice of the death; e.g. they went to visitation at the funeral home.
* You are not in a position to close the decedent's IRA and open pay-out accounts in the name of the POD beneficiaries. They may have predeceased the decedent, they may choose to disclaim their interests, you probably do not have all of the necessary information, etc. etc.
* Few automatically attempt to contact beneficiaries. First, there is no logical place to stop looking once you start. Second, there is no way to be certain the beneficiary already knows of the death and your reaching out will be the most embarrassing phone call or letter of your life.
* Add your inability to establish contract terms for a beneficiary's pay-out account to your reasons for not setting one up before you hear from the beneficiary.
* A person who inherits an IRA has absolutely no reason whatsoever to sign an IRA agreement. They are not opening an IRA. They inherited the decedent's IRA. If the file is too light, put a copy of the decedent's IRA agreement and beneficiary designation in the folder. That should satisfy anyone's desire for a paper trail. Should the beneficiary sign a beneficiary designation of his or her own? Yes.

There are differing opinions to some of the above. Some bankers have attended one too many seminars and want to pretend that they are in control. They forget their employer is the "custodian" and it holds the assets, nothing more.

Pretty much the same as Ken outlined.
- We require a death certificate (although if they have a checking account that receives SSN payments and we receive a notice of death we will flag all of their accounts including the IRA and make sure to suspend any automatic distributions scheduled to go out)
- We do not automatically close the decedent's IRA and open Bene IRAs. As Ken stated, you have no idea what the status of those beneficiaries actually is. They could have predeceased the IRA owner, they could have no interest in the funds and disclaim, and almost always we don't have enough of their information to establish a new account for them anyway.
- If somehow we received notice of death from someone other than the beneficiary already listed on the IRA, no we would not take it upon ourselves to go in search of them. We wait until the beneficiaries initiate contact with us. If that contact never arrives, then follow your State's abandoned property regulations if the funds are never claimed.
- We don't process an automatic closeout. If a bank was determined to have such a policy they need to start by disclosing it properly at account opening, rather than try to come up with a plan after someone has passed away. This course of action would get really ugly very fast though, starting with the first beneficiary that takes exception to you deciding for them what is to happen to the funds that they are entitled to along with the options that may be restricted as a result of the bank's actions.
- The subject of a new IRA agreement has always been less than ideal. Legally the IRA still belongs to the deceased and the beneficiary remains a beneficiary with the right to draw funds from the deceased's IRA. They do not become the new IRA owner (unless it is a spouse beneficiary that makes that affirmative election, but then you just have a "new" IRA on your hands and all beneficiary issues disappear). That being said, there is a real concern for obtaining some type of acknowledgement from the beneficiary that they agree to the terms and conditions of the product that they may choose to move the funds into as an inherited IRA. Form vendors have done a good job of creating "Inherited IRA Applications" that are tailored specifically for these circumstances. Check with your IRA form vendor to see if they have such forms available. If not, then as Ken offered, supply them with the agreement that the IRA owner signed and obtain signatures on the non-IRA account opening documents that go along with whatever type of account they choose to open.

Always be cautious of offering what may be construed as advice. A beneficiary should always be made aware that it is in their best interest to seek the help of a qualified estate planner that understands IRA beneficiary options. Don't fall into the trap of believing you make the decisions on behalf of the beneficiary.