How to Add a Payable on Death Beneficiary to Your Bank Account

What a payable on death account does

A payable on death (POD) designation lets you name someone to receive the money in your bank account when you die, without the account going through probate. The person you name—your beneficiary—has no access to the account while you're alive. When you die, the bank transfers the balance directly to them, usually within a few weeks.

This is different from adding someone as a joint owner. A joint owner can withdraw money right now. A POD beneficiary cannot touch the account until you're gone, and only then if they present a death certificate to the bank.

POD designations work on checking accounts, savings accounts, and money market accounts at most banks. They do not work on investment accounts or retirement accounts, which have their own beneficiary rules.

Key Takeaways

• You name your POD beneficiary by filling out a form at your bank—usually called a "Beneficiary Designation" or "POD Account" form—and the change takes effect when ready.
• The person you name receives the account balance after you die, but has zero access while you're alive.
• POD accounts bypass probate, meaning the money reaches your beneficiary faster and without court involvement.
• You can change or remove a POD beneficiary at any time by contacting your bank, and the most recent form on file is the one that counts.

How to set up a POD designation at your bank

Contact your bank and ask for the beneficiary designation form. Most banks call it a "Payable on Death Designation" or "POD Account Form," though some use "Beneficiary Designation." You can usually get it in person at a branch, by phone, or by downloading it from the bank's website.

Fill in the form with your account number, your name, and the full legal name, date of birth, and Social Security number of the person you want to name. Some banks let you name multiple beneficiaries and specify what percentage each one receives. If you name two people and don't specify percentages, most banks will split the account equally between them.

Sign the form in front of a bank employee or notary, depending on what your bank requires. Some banks notarize it; others just need your signature witnessed by staff. Return the completed form to your bank. The designation takes effect when ready, and you'll receive a copy for your records.

What information you need to provide

You'll need the full legal name of your beneficiary exactly as it appears on their government ID. Middle names and initials matter—if the name doesn't match their Social Security record, the bank may delay the transfer after you die.

You'll also need their date of birth and Social Security number. The bank uses these to confirm their identity when they come to claim the account. If you're naming a minor, some banks require you to name a custodian or guardian who will manage the money until the child reaches the age of majority in your state.

Have your account number ready. If you're setting up POD on multiple accounts, you'll need a separate form for each one.

Changing or removing a POD beneficiary

You can change your POD beneficiary at any time while you're alive. Contact your bank, fill out a new beneficiary designation form, and submit it. The new form overrides the old one. Keep a copy of the new form for your records and destroy the old one so there's no confusion later.

If you want to remove the POD designation entirely and leave the account to your estate instead, you can do that too. Ask your bank for a form to revoke the POD designation. Without a named beneficiary, the account will go through probate when you die, which takes longer but gives your heirs a court-supervised process.

The bank's records show only the most recent form you submitted. If you've moved or changed banks, make sure your current bank has your current designation on file. Old forms at closed banks don't matter.

What happens after you die

When you die, your family or executor should notify the bank. The beneficiary will need to bring a certified copy of your death certificate to the bank, along with a government ID. The bank will verify the death certificate, confirm the beneficiary's identity, and transfer the account balance to them.

This process usually takes two to four weeks, though it can be faster if the bank has everything it needs. The beneficiary receives the full balance as of the date of death, minus any outstanding fees or holds the bank placed on the account.

The POD account does not go through probate, so the beneficiary doesn't have to wait for a will to be read or for a court to approve the transfer. This is one of the main reasons people use POD designations—it's simpler and faster than leaving money through a will.

POD accounts and taxes

The money in a POD account is still part of your taxable estate for federal estate tax purposes, even though it bypasses probate. If your total estate is large enough to owe federal estate tax, the POD account counts toward that total. Your executor or beneficiary will need to report it on the estate tax return if one is required.

The beneficiary does not owe income tax on the money they receive from a POD account. Inherited money is not taxable income. However, if the account earns interest between now and when you die, that interest is taxable income to you in the year it's earned, just like any other account interest.

State inheritance taxes vary. Some states don't have them. Others tax certain beneficiaries but not others. Check your state's rules or ask your bank whether POD accounts are subject to state inheritance tax in your location.

When POD doesn't work the way you expect

If you die with unpaid debts, creditors can sometimes claim money from a POD account, depending on your state's laws and the type of debt. Federal student loans and tax debts have priority in some states. Check your state's rules if you're concerned about this.

If you name a minor as your POD beneficiary and don't name a custodian, the bank may freeze the account until the child reaches the age of majority, or it may require a court order to release the money. To avoid this, name an adult custodian on the form when you set it up.

If your beneficiary dies before you do, the POD designation becomes void. The account will then go to your estate and through probate unless you update the form to name a new beneficiary. Review your POD designations every few years to make sure they still reflect who you want to receive the money.

Frequently Asked Questions

Can I name more than one person as a POD beneficiary?

Yes. Most banks let you name multiple beneficiaries on a single account. You can specify what percentage each person receives, or leave it blank and they'll split the account equally. Make sure the percentages add up to 100 percent.

Does my POD beneficiary have any access to the account while I'm alive?

No. A POD beneficiary cannot withdraw money, see the balance, or make any changes to the account until you die and they present a death certificate. If you want someone to have access now, you need to add them as a joint owner instead.

What if I have a will that says something different about who gets the account?

The POD designation overrides the will. If your will says your son gets the account but your POD form names your daughter, your daughter gets the money. Make sure your POD designations match your overall plan, or update them if your wishes change.

Can I set up a POD account online?

Some banks let you read and submit the form online, but most require you to sign it in person or have it notarized. Call your bank to ask whether you can complete the whole process online or if you need to visit a branch.

What if I want to leave money to my estate instead of naming a specific person?

You can revoke the POD designation by submitting a revocation form to your bank. Without a named beneficiary, the account becomes part of your estate and goes through probate. This takes longer but gives your heirs a court process to follow.