Answer:
Whether or not a trust may be designated as a payable-on-death beneficiary of a sole proprietor's account is a matter of state law. As I see it, you have two issues to determine -- (1) whether a sole proprietor in your state may designate a payable-on-death beneficiary for a business account in the sole proprietor's name; and (2) when a trust is allowable as the POD beneficiary.
As to question (1), the answer is most likely "Yes." On question (2), the answer is less clear. Talk with bank counsel.
First published on BankersOnline.com 3/25/13