Tenants By Entirties Bank Accounts: Client’s Plan Foiled By A Box

It is not easy to open a tenants by entireties bank account. I’ve written previously that  some banks refuse to offer entireties accounts; some banks offer them but you have to ask and be lucky the bank representative knows what you are talking about; also, banks frequently change their account application forms.

Florida law tries to make it easier- Florida law presumes that any joint financial account opened by married depositor is an “entireties account” unless the couple disclaims entireties ownership and/or indicates preference for another ownership form.

A married couple was in my office this week reviewing their assets. They said they had a joint bank account at Bank of America. BOA has for a long time recognized entireties accounts. At first, it seemed to me that the couple clearly had a protected entireties account at BOA. But, then I asked them to show me their account application form. Most people don’t have copies of their account application form or they do not bring it with them to my consultation. This couple had their form.

The couple had checked a box indicating joint ownership with rights of survivorship. In most cases, this ownership would be presumed to be entireties ownership under the Florida presumption. The problem is that BOA has added an “tenants by entireties” box next to the JTWROS box. I think most of their married customers don’t understand the difference, and I assume most bank officers do not know, or do not bother explaining the legal distinction, to their new customers.

This bank account probably is not an entireties account because the couple indicated a preference to own their account as joint tenants when the entireties option was clearly presented as an alternative ownership choice. The couple has disclaimed entireties ownership on thier application.
As a practical matter, if their monthly bank statement showed “TE” or “tenants by entireties” on top of the statement most creditor attorneys and judges would conclude that the bank account is an exempt  tenants by entireties account. Technically, the account is not an entireties account and is not asset protected from the individual creditors of either spouse. The example shows how difficult it can be to properly title financial assets. People cannot practically consult an asset protection attorney each time they open a financial account, but sometimes that is what the law demands.

Last updated on May 22, 2020

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