The following question appeared in the Q&A section of Banking Spectrum's Report Bulletin last month. Compare your answer to the correct answer below:
Q: A father opened an “in trust for account” for his minor child to receive direct deposit of social security. The father died last month. The child is under 18 and the account has $20,000 in it. The mother came to the bank and she wants to open an account to continue to receive the social security benefits. How does this get accomplished?
A: Since the account is an I/T/F account and the child is a minor, with an account balance of over $10,000, she will need a guardianship order from the local supreme or surrogates court to manage the account for her child. The account may be opened as a custodian account. If she wishes to bypass these rules she can apply directly to the social security administration for status as a representative payee for the direct deposit of social security benefits for the child.