During my tenure with Baptist Homes, I have regularly encouraged donors to designate gifts to our ministry via the beneficiary designation for cash-based accounts such as checking, savings, and Certificates of Deposit. In general, these designations are simple to create. Your local financial institution can provide instructions on how to designate an individual or ministry as a Payable on Death or Transfer on Death designee.
Upon the death of the account owner, the account becomes ‘payable’ or ‘transferable’ to the designee. Simple, straightforward, no need for legal counsel to create any complicated document—once you’ve done this, all is well, right? Unfortunately, we’ve come to learn that it is not as simple as it should be. Over the years, I have had several occasions in which receiving the intended gift was anything but simple.
For example, we learned of the gift of a woman’s checking account from her widower, who was perplexed that we had not claimed his wife’s gift in over three years. Upon further investigation, we learned that the bank had held the account open for over three years but never notified the Baptist Homes that we were the designee of the Payable on Death designation. Upon further discussions with the bank, I learned that they are under no legal obligation to notify any Payable on Death designee of the arrangement. After six visits to the bank and several notarized documents, I was finally able to receive the donor’s gift. The donor’s husband was not happy with the bank he had done business with for years.
Another, more recent account involved the designation of several Certificates of Deposit for Baptist Homes from multiple banks, all from the same donor. In this case, the donor had no direct heirs and left her financial Power of Attorney in charge. In order for the Power of Attorney to represent the donor, the courts had to appoint the POA as the Executor of the deceased estate. It was at this point that the Executor reached out to us about the donation. We attempted to handle things via technology, but this was impossible. We dealt with three different banks, and they all had very different requirements. The result was an overnight trip and multiple visits to the banks accompanied by the Executor.
Recently, I have learned of potential legislation working its way through our Missouri Legislature. This legislation will require consistent and simple procedures to ensure the wishes of donors are honored. However, it doesn’t appear to be moving out of committee this year. A call or letter to your elected representative would be very helpful. Ask them to support House Bill 1924.
So, is it still a good idea to use POD and TOD designations for gifts after the passing of a donor – yes. I would suggest this follow-up information. Please provide your Financial Power of Attorney or the Executor of your estate with a written explanation of the accounts, the banking institution and the name of the charity, with instructions for your representative to notify the charity with the proper information.
Thank you for your continued support of Baptist Homes.
Dr. Ron Mackey, Vice President, Community Engagement
