Treasury Direct and Our Trust as the Registration
My wife and I have had a trust created for us and are moving the appropriate accounts and assets into the trust. We have T-Bills under my account and I-Bonds in my account/name, my wife’s account/name and our trust account/name. I read your Ask Terry article on beneficiaries and registration for I-Bonds, but do not think that it addresses my question. How do I set up all 3 accounts to be controlled by the trust? Do I make the trust the new Primary Owner? Sole Owner? Do we add the trust as beneficiary for all 3 accounts? They are currently set as POD. By the way, I posed this question through the TD site and the response I get is that they are only addressing, my words, not theirs, big and important issues. Love your website, read your book and listen to you most Wednesdays on WGN radio.
Terry Says
OK, well a couple of separate things here. Let’s start with Treasury BILLs. You should have set up a bank account in the name of the revocable living trust. From now on, do all purchases of T-bills in your Trust account at TreasuryDirect. Let the old T-bills mature and get deposited back into your individual bank accounts. Then move the money into your RLT bank account, and make future T-bill purchases out of that account. Then, if one of you dies, the other trustee can take over immediately. Or if both die, the T-bill assets named in the trust will be distributed according to the instructions in the trust. Remember, you can buy an unlimited amount of T-bills so this is the way to go – putting them all in the account of the Trust at TD.
BUT for I-bonds, you have a slightly different story. First you’re limited to $10,000 per year. Second, if you purchased them in the last year you want to keep that high-rate bond! And in order to transfer registration you would have to sell the bond and pay any applicable taxes and early withdrawal fees. INSTEAD, you should name each other as “beneficiary” in each of your accounts. (You might also have a third account in the name of your trust — even though it uses your SS number — and you don’t have to worry about that one.)
You add a beneficiary to the separate I-bond accounts following these directions:
Before editing the registration of your securities held in your TreasuryDirect account, you need to check your registration list to determine if the desired registration is available. Adding a new registration is simple, but there are a few rules:
1. Registrations can only be added to individual TreasuryDirect® accounts.
2. You can add new registrations in your name alone, your name with a secondary owner, or your name with a beneficiary.
3. For gift savings bonds, you can use the same forms, but you can only be named on them as a beneficiary. (You can’t buy marketable securities as gifts.)
4. Each registrant’s social security number must be shown.
To add a registration to your Registration List:
1. Access your TreasuryDirect account.
2. Click the ManageDirect® tab at the top of the page.
3. Under the heading Manage My Account, click Update my Registration List.
4. Click Add Registration to display the next page.
5. Choose the type of registration you want: Sole Owner, Primary Owner, or Beneficiary.
6. Enter the name(s) and social security number(s) in the spaces provided. (If you are buying the security for yourself, you must be the “First-Named Registrant.” If you are buying the savings bond as a gift for someone else, you have two choices: leave your name off or list yourself as beneficiary.)
7. If you want this registration to appear at the top of your Registration List when using BuyDirect®, check the box for Make this my preferred registration.
8. If savings bonds with this registration are gifts, check the box beside This is a gift.
9. Click Submit to complete the process.
The registration you just created will appear in the Registration List where you can choose it when making purchases with BuyDirect or editing the registration of existing securities held in your account..
To add a secondary owner or beneficiary to your securities:
1. Click the ManageDirect tab at the top of the page.
2. Under the heading Manage My Securities click “Edit” a registration.
3. On the Edit Security Registration page, choose the security type you want to edit and click “Submit”.
4. On the Summary page, choose the security or securities you wish to edit and click “Select” (you may edit up to 50 securities to the same registration).
5. On the Detail page, select the registration containing the secondary owner or beneficiary you desire from the drop-down box. Note: Entity accounts may only have one registration. All securities in an entity account carry a registration identical to the entity account name.
6. Once you’ve selected the desired registration, click “Submit” to complete the change in registration for the security.
