Revocable Living Trust Bank Accounts - Explained

Revocable Living Trust Revocable Living Trust Bank Accounts - Explained

Setting Up Revocable Living Trust Bank Accounts

Once you plan on setting up a revocable trust, at some point you'll have to get a special separate bank account for it. This account is called a trust checking account and that's where all your selected assets will be transferred for safekeeping during and after your lifetime.

This guide will show you what to expect when creating a trust checking account and how you can prepare before opening one.

Revocable Living Trust - What Is It?

A revocable living trust is one of the common ways people bequeath their assets to a named beneficiary when they pass away. It looks much like a will that serves a similar purpose. However, the major difference is that revocable trusts begin to take effect while you're still alive and become irrevocable when you are no more. 

With a revocable trust, you can start your estate planning early and it offers great flexibility, unlike irrevocable trusts.

Revocable Living Trust Bank Accounts and Banks

A revocable living trust checking account, also known as a trust checking account, is a type of bank account prepared for the transfer and disbursement of all your estates according to the instructions in your trust.

Only a select few banks across the US offer trust checking accounts and the minimum investment varies depending on the bank. Here's a table of five top banks in the US for trust checking accounts:

Banks in the USALiving Trusts Accounts SupportMinimum depositYearly charges
PNCBoth Irrevocable and Revocable$1 million0.4 - 1.4%
Bank of AmericaBoth$0.5 million - $0.6 million0.45 - 1.4%
Wells FargoBoth$1 million0.4 - 1.5%
U.S. BanksBoth$0.25 million$40 
J.P. MorganBothNo limit0.15 - 0.55%

Tips for Setting Up a Trust Bank Account

Before heading to your chosen bank, here are tips to help you open your account seamlessly:

Bring your trust certificate

This is a shortened version of your trust document that is needed to open a trust checking account and usually prepared according to the state laws where you live. Your certificate of trust is ready once you've filled up the trust form, completed the steps, and notarized your revocable trust document.

Specify the trust details

Generally, your certificate of trust document should contain all the needed details about your trust including the name of the trust, stated beneficiaries, name of trustees, and other valuable instructions.  For FDIC purposes, it is a great idea to include terms such as "in trust for" (ITF), "as trustee for" (ATF), or "payable on death" (POD).

Provide your SSN

Since you are the grantor of a revocable trust, you'd be responsible for all the taxes due in a checking account. A revocable trust gives you the flexibility to evoke changes to your trust as you please, therefore, it won’t be a separate entity from you. Bring your SSN to the bank and other identification documents to confirm your identity.

Checking Accounts and the FDIC

Once you open a checking account, you are guaranteed insurance by the Federal Deposit Insurance Corporation (FDIC) for up to $250,000 for each named beneficiary, provided there are no more than five persons. The process becomes complicated with six persons and above. 

The FDIC classifies valid beneficiaries as:

  • Any natural living human being
  • Any IRS-registered charitable organization
  • Any other IRS-recognized not-for-profit entity.

How to Set-Up a Revocable Trust

Before heading to the bank for a trust checking account, you’ll need to have a revocable trust ready. Here are some of the steps required to get that done:

  1. Consider which type of revocable trust you prefer — a joint or an independent one
  2. Make a selection of your beneficiaries
  3. Register yourself as a grantor, choose your trustee, and a custodian (if a beneficiary is a minor)
  4. Select what assets make up your revocable trust (properties, bank accounts, life insurance policies, pets, etc)
  5. Obtain and fill out a revocable trust form or get one created with a lawyer
  6. Notarize your revocable trust form at a state or federal court and obtain a certificate of trust
  7. Head to the bank for a trust checking account

Use DoNotPay to Get a Cheap Revocable Trust

You save big on set-up costs and get your revocable trust ready in record time when you use DoNotPay. Here are all the steps you need to take:

  1. Log-in to DoNotPay and start a Revocable Living Trust document
  2. Provide the state you reside in and the state you plan on getting the document notarized
  3. Choose your trustee, successor trustee, and a second successor trustee
  4. Provide the names of your living children and beneficiaries
  5. Tell us what should happen to the assets not listed in the trust

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