Bank Accounts and Comprehensive Estate Planning in Idaho

As a general matter, people dislike probate. The dislike is for a variety of reasons, including reasons related to the administrative burdens, attorney fees, time, and the public nature of probate proceedings. A quick internet search by those keen on avoiding probate will return a wide array of techniques and videos advising on how probate can be avoided. 

While there are situations when someone would want to plan on probating their estate, there are a variety of ways to avoid needing the probate to clear title to or transfer estate assets. In terms of bank account assets, one of the most common is through non-probate transfers, see I.C. § 15-6-101 et seq., including through multi-party accounts such as P.O.D. accounts or joint-ownership accounts with the right of survivorship. Id.; I.C. § 15-6-101(10) (2024); I.C. § 15-6-104. 

However, while non-probate and other types of transfers that are consistent with a comprehensive estate plan can make the administrative process after the death of a loved one easier, inconsistencies between titling and the estate plan can lead to more difficulties in estate administration. As one recent example in Idaho, the Idaho Supreme Court addressed a joint-checking account in Kelso v. Applington, 548 P.3d 363 (Idaho 2024), where a dispute emerged between the surviving joint owner of a checking account and the beneficiary of a testator’s entire estate. 

As described in the opinion, there was a dispute over the ownership of checking account funds (amounting to nearly $140,000) following the death of one of the joint owners (“Father”). Father was originally a joint owner with a right of survivorship of a checking account with his wife. After his wife died in 2017, Father’s friend (“Friend”) began helping Father process his monthly bills. In March 2018, Father executed a will leaving his entire estate to his son (“Son”).

In May 2019, Father added Friend on his checking account as a joint owner with the right of survivorship. Sadly, Father died in 2020. Son became the personal representative and sole heir of Father’s estate. After his father’s death, Son sought to have the nearly $140,000 in the checking account transferred to Father’s estate. Friend declined the request to transfer the funds into the estate and claimed ownership of the account under the right of survivorship. Thereafter, Son brought suit as personal representative of Father’s estate to invalidate the gift under Idaho Code section 15-6-104 for lack of donative intent and other equitable claims. Friend moved for summary judgment. The district court granted summary judgment Friend after it found that there was “clear and convincing evidence that [Father] intended Friend to have the funds in his account upon his death[.]” Kelso, 548 P.3d at 367.

While the Idaho Supreme Court ultimately reversed the decision finding a genuine issue of material fact, the facts of Kelso highlight the importance of a comprehensive and holistic estate plan. A comprehensive estate plan must take into account not just the desired outcome but also the non-probate transfers working in conjunction with the estate plan and applicable relevant statutory considerations. 

As explained by the Idaho Supreme Court, cases in Idaho like Kelso turn on whether an intent to give the checking account funds can be shown. However, depending on how the checking accounts are set up, results can differ. Suppose a mother originally intends to make a gift to a friend, but decides later to make a change to leave everything to her daughter and does so in her properly executed will. If that mother had properly made the friend the POD on her account, Idaho Code seems to foreclose a later change by will. Idaho Code section 15-6-104 (e) provides “[a] right of survivorship arising from the express terms of the account or under this section, if an intent to give can be shown, a beneficiary designation in a trust account, or a P.O.D. payee designation, cannot be changed by will.” I.C. § 15-6-104 (emphasis added). While someone might take great care to detail specifics of their checking and savings accounts in their will, undesired results can inadvertently occur if not done so in a comprehensive manner. 

Estate planning should take into account all of the assets and the desired outcomes. Moreover, any desired changes must be done in a way that is consistent with the estate plan and not contrary to it. For this reason, both estate planning and any subsequent updates should be completed under counsel from a licensed attorney. 

Are you looking for comprehensive estate planning? Or are you looking to make updates to the estate plan you have in place? We are here. Call Patton & Buller to begin your comprehensive estate planning today at 208-510-6353 or visit our website at www.pattonbuller.com/contact. 

Patton & Buller PLLC

805 W. Idaho St., Suite 202

Boise, Idaho 83702

208-510-6353

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