Payable on Death
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Payable on Death Can a partner make his interest in an investment club payable on death to an individual or trust? Has anyone done this? Thanks, Scott if you have a pour-over will, yes. An investment club should not get involved in beneficiary designation. Bob Mann > On October 10, 2018 at 2:19 PM "Scott Freeman via bivio.com" <user*1595500001@bivio.com> wrote: > > > Can a partner make his interest in an investment club > payable on death to an individual or trust? Has anyone done > this? > Thanks, > Scott Bob and Scott: We need to clarify Scott's question a bit. I believe his question is whether he can provide instructions to the investment club to transfer his individual ownership interest in the partnership to a third party, individual or trust, so that at his death the club does a withdrawal of his interest and pays cash or transfers stock to the third party without probate. The general answer would be NO. The more specific answer is "it depends on the law of his state." The state law would have to provide for the designation of a beneficiary interest in a partnership as do many states for bank accounts and brokerage accounts. I doubt there is a state that has enacted such a law, but there are 50 states so it is possible. No provision of this nature exists in the Uniform Probate Code, which is used a model by many states. If Scott is the trustor and trustee of a revocable trust, investment clubs can authorize the partnership interest to be owned in the name of the trust. At the death of the trustor, the club can perform a withdrawal and distribute the cash or stock to the trust without probate. It is not a transfer because the trust owned the interest pre-death so it is no different than a living person withdrawing from the club while still alive. There has been mention in previous messages on this topic that a pour-over will handle the interest in partnership if the trust is not the owner. While this is true, a pour-over will is no different from a regular will in that it must be probated in accordance with the laws of the state. That is why folks with a trust are encouraged to make sure all assets are in the name of the trust so that no probate is required. The pour-over will is just an insurance policy in case something is inadvertently left out of the trust. Jack Ranby, Treasurer, Grants Partners Investment Club -----Original Message----- From: club_cafe@bivio.com [mailto:club_cafe@bivio.com] On Behalf Of Bob Mann via bivio.com Sent: Wednesday, 10 October, 2018 11:46 To: club_cafe@bivio.com Subject: Re: [club_cafe] Payable on Death if you have a pour-over will, yes. An investment club should not get involved in beneficiary designation. Bob Mann > On October 10, 2018 at 2:19 PM "Scott Freeman via bivio.com" <user*1595500001@bivio.com> wrote: > > > Can a partner make his interest in an investment club payable on death > to an individual or trust? Has anyone done this? > Thanks, > Scott Thanks Mr. Ranby. That addresses my questions and gives me some work to do. Scott Bob and Scott:
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