Deposits for revocable and irrevocable trusts will now be treated the same under a new Federal Deposit Insurance Corporation (FDIC) rule. The changes take effect on April 1, 2024.
Details:
- A deposit owner’s trust accounts are insured up to $250,000 per beneficiary, up to 5 beneficiaries max
- This applies regardless of whether the trust is revocable or irrevocable
- It provides a maximum $1,250,000 in coverage per owner, per bank for trust deposits
Â
The new simplified rule is intended to facilitate more timely insurance determinations in the event of a bank failure.
The new rule does not affect other ownership categories, such as single accounts, joint accounts and IRAs.
POD accounts with a trust named as beneficiary are not affected. The account will continue to be treated as if it is titled in the name of the trust.
Visit the FDIC website for more information on deposit insurance.