My mother-in-law has a trust brokerage account along with my brother-in-law. He just died and she has been certified with dementia. Brokerage firm wants both off the account and the successor trustee to supply her social security number for account. Problem is SS and VA checks etc. of mother-in-law automatically deposited to account to provide care.
Is this all okay or will it create issues with government?

Terry Says:

Whew, this is going to be very complicated.  Your first step is to find an attorney who actually represents your mother in law — because you will have to legally have her certified as incompetent to manage her affairs.  Go to www.NAELA.org ( the National Association of Elder Law Attorneys).  There you can search for an attorney in your area.

Tell the brokerage firm that you are in the process.  I’m surprised that they would transfer control of the account to a successor trustee (even if one is named on the papers) before they get a certification that your mother has been declared incompetent.   In the meantime, let the checks accumulate in the account.  Certainly the government will require this type of certification before they would allow you to switch to a simple bank account to receive the checks in the name of her court-appointed guardian.  So tell the brokerage firm to hold on for a while.  (If they give you trouble, please write back to me!)

And now here’s the lesson for everyone reading this Q&A:  A “trust” account or a joint account is not the answer to dealing with the assets of the elderly.  If the mother had created a REVOCABLE LIVING TRUST and used that title on her accounts, then the successor trustee would automatically take over if she cannot act.  Now this family will be stuck in a horrible court process to declare the elderly woman incompetent — delaying all other actions on her accounts!

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