My parents have a trust and I am listed as the Trustee upon their death or incapacitation. They have two checking accounts in the trust. I also have financial and health POA for both. Because my Dad has Alzheimer’s and my Mother has Macular Degeneration, I recently tried to add my name to their checking account so that I could sign checks. My parents accompanied me to the bank and requested my name be added to the account. We were told by both banks that because the accounts were in the Trust, I could not be added. My Mom cannot see and my Dad can presently still sign his name after I write out the check but I don’t anticipate that continuing much longer. Do you know how to resolve this problem?
I had her pre-sign a dozen checks. Then I used her credit card to pay for anything I was able to and paid the card (and the rest of her bills) online from her bank account. It was actually far easier to do it that way than to fill out the checks and mail them.
I still had about half a dozen signed checks when she passed.
Good luck!
Sadly this is a fact. Anything in the Trust is managed by the Trust, no longer really your parents. This will be more difficult if your parents are no longer competent and would mean letters from doctors and whatever the trust stipulates you need. And be warned. Any good lawyer will warn your parents, do they for sure want to do this, because as my brother's attorney said to him: "Do you trust this woman as you do yourself? Because once this is done you cannot change it and she can sell the gold out of your teeth".
Do know that not all entities are helpful. Basically they want original documents, and copies of them. When I went to bank and learned that my POA was not good because that was a Trust account they would not even tell me WHY it wasn't. I had to call the Attorney from their desk and together we figured it was a Trust and I needed to come back with my bro and be made Trustee of Trust. When I asked why they could not give me that simple advice they said they didn't "advise" about such things.
What a learning curve it all was! When you buy books most just tell you how to manage things AFTER death, and that's not what you need at all. I sure wish you good luck. Keep a diary is my advice. Names, dates, who you speak with, what you do. It was invaluable to me, along with a separate phone book.
ALL of her assets were in the trust. That was how her attorney told her to do it. I'm sure there was a reason for it, but I never really cared enough to ask. It made settling her estate incredibly easy - I had it settled and closed out in less than 3 months. It helped that she had no real estate to have to sell.
And as I said, there was no problem with doing her finances. She just pre-signed checks for anything I might have needed a check for. But honestly, the only thing I ever needed those checks for was to pay her estimated taxes and make her contributions to church. All of her bills I paid online directly through her checking account, and we used her credit card for purchases- and then paid THAT bill online.
Even for my own banking, if I use 25 checks a year, that's a lot. Online banking/bill paying has made check writing almost superfluous.
1. If he or she is available, consult with the attorney who drafted the trust. If that attorney is not available consult with a trust and estate attorney.
2. Read the POA documents carefully. Learn what powers the financial POA gives you as the agent and if it mentions the trust.
3. Read the trust instrument carefully. Check if it includes terms about a financial POA.
4. Educate yourself about trusts. When a grantor puts assets in a trust, the trustee of the trust "owns" the assets in the name of the trust. The trustee cannot use the trust assets for themselves. They must follow the terms of the trust for the good of the beneficiaries.
5. In a revocable living trust, the grantor(s) can add assets, remove assets, change the terms of the trust, or terminate the trust. Therefore, a grantor can remove bank accounts from the trust.
6. Once the bank accounts or at least one is removed from the trust you, as the financial POA agent, can then manage those assets.
7. If and when the bank account(s) are removed from the trust, do not add your name to the bank accounts. As the financial POA agent, you don't need to and this can cause problems down the road.
8. I'm not sure, but your mother might be able to change the terms of the trust to allow you as POA agent to remove bank account funds from the trust. Check with a trust and estate attorney on this.
9. In general, if the person who named you as POA agent is still competent (I don't think blindness would render your mother incompetent to manage her financial affairs) she would have to agree with however you manage the bank account(s). She can also just leave it up to you.
10. Be aware that if the bank account(s) are removed from the trust, the bank may want your father, if he is competent enough, or you mother, to use the bank's POA forms to name you as agent. If your mother seems to be failing mentally, do this as soon as possible.
11. You say that the trust allows you to succeed due to incapacity. I am going to assume you mean you succeed if the current trustee(s) are determined to be incompetent to handle their financial affairs. If your parents are co-grantors, etc., look at the terms of the trust to see if you can succeed your father as co-trustee with your mother. His financial incompetency would have to be made evident.
12. Ask if it would be better for your mother to step down as co-trustee so that you could succeed as sole trustee. Of course, she would have to agree.
13. If we're talking about a revocable trust, you probably don't need to notify any other beneficiaries named in the trust if there are changes. But you should make sure.
14. All the above gets thrown into a cocked hat if the trust is irrevocable. Then you really need to talk either to the attorney who drafted the trust or a trust and estate attorney. Good luck!
15. Remember that different states have different laws. So, if you are in one state and your parents are in another, you must refer to the laws of your parents' state.
All the above are suggestions and not legal advice.
Since there are additional issues as well, find a law firm with a probate, estate and trust practice area. Attorneys in these areas work together and can provide insight for various areas that cross the trust lines, such as estate issues.
This would have been especially useful if she had needed to sell real estate in the trust.
Invoking incapacity is more essential if they shouldn't be making decisions on their own.
My parents resigned as Trustees when Dad (the one handling their finances) was diagnosed with cancer and given a month to live. Mom had early-ish dementia and macular degeneration, so she was not going to be able to handle her affairs once Dad was gone. Their attorney kindly made a house call, recommended that course of action, and we did the paperwork on the spot. I took over everything then and there.
You could also open a new account at a different bank with all three of your names on it, then transfer money into that. My folks had one checking account outside their trust, they added me years ago, and and Dad would transfer money into it as he needed to pay bills. I was able to take over the bill paying even without the trustee change, because technically, I was a co-owner on the account and it was oqtside the trust.
If it would cover their monthly bills, consider having their SS checks deposited into that new account, then you wouldn't need to transfer money from the trust account too often. It's also good to have an account like this to pay for final expenses and such if needed. That way you can access funds immediately when needed because you're technically one of the owners of the account.
Check with an attorney before doing any of this if Medicaid might be in their future, though. They've got wonky rules I'm not familiar with, and you don't want to mess up and co-mingle with their finances if it's prohibited.
Get all these ducks in a row BEFORE you have Dad declared incapacitated, because then he can't resign from the trust or sign anything to create a new account. (Leaving him off the new account wouldn't be the worst thing in the world either. Not having signature rights would keep him from writing checks to scammers and such as his dementia proceeds.)