Transfer on Death (TOD)

If you do not have a spouse, holding financial assets with a TOD designation is a great way to make it easier on your executor to handle the distribution of your estate. Holding assets jointly with adult children can be a problem as they have access to the funds which you may not want, and the IRS will consider that you have gifted 1/2 of the account to your child which may necessitate a gift tax return. A power of attorney goes away upon the death of the signer so it is of no help in moving assets after death. With a TOD all you need is the death certificate to move assets.