"Pay on Death" Financial Account
When a person sets up a savings account, share account or certificate of deposit for
the benefit of another person or a charitable interest at his or her death, the balance
of the account passes outside the provisions of the will. The individual retains the
right to withdraw funds as may be needed. Thus, there are no federal income tax savings
allowed even when the beneficiary is a charitable interest.
At death, the assets passing from a financial account to qualified charitable interests
are fully deductible from the federal estate taxes, if applicable.