Most people would agree that protecting valuables in a safe deposit box is a smart idea. A safe deposit box typically is a metal drawer locked in a large steel, climate-controlled vault inside a bank, where items such as important papers (wills, deeds, birth certificates, car titles, etc.), jewelry, rare collectibles, backed-up computer files, and so forth are protected from risks such as flood, fire, and theft. With an average cost of only about $60 a year, safe deposit boxes are a small investment to guard things that would be difficult or impossible to replace.
However, one of the attractive things about safe deposit boxes – the fact that they are hard to get into – can be a serious detriment following the death of a loved one who rented the box. Specifically, what if a single parent or childless sibling dies suddenly without having established secondary access to their safety deposit contents? Even though they may have fully intended for you or someone else to rightfully inherit the valuables stored there, it can be problematic to actually retrieve the items from the bank vault.
Sometimes, surviving inheritors may not even know of the existence of a box full of valuables with their name on it, or if they do, they may not know where it is. Sadly, the contents of many safe deposit boxes around the world ultimately go unclaimed.
Legal recourse in the case of a decedent
If the renter of the safe deposit box dies without specifically granting access to someone else in advance, certain legal steps are needed to open the box. The process varies from state to state and can be affected by a number of related circumstances, such as the terms of the deceased renter’s will, physical possession of the box’s key, the named executor of the estate, and other factors. In some states, a surviving spouse can gain access to a box by presenting a death certificate and proof of marriage.
For more complex cases, the executor or a designated personal representative of an estate may have to formally petition the court to get permission to open a safe deposit box. If the deceased person’s estate has gone to probate, the process is even more daunting and convoluted.
Then after permission is obtained, the person opening the safe deposit box often is under further scrutiny, such as having a bank representative catalog all of the box’s contents and photocopying any documents found inside. In certain extreme instances, the Internal Revenue Service may have frozen access to the deceased renter’s box until outstanding tax disputes have been settled.
Joint access: the smart and easy solution
For someone to open their safe deposit box under normal circumstances, they must have a pre-registered signature on file at the bank and have an assigned key in their possession. Then he or she must present the key to a safety deposit administrator, who will accompany them to the vault with a second key. Two keys are always needed to open the box.
The procedure is that simple with the signature and a key. Obviously then, the best strategy is to name an authorized joint account holder. When two parties have their respective signature/identification cards on file at the bank when they first rent the box, and then maintain two keys for it, the surviving renter can still freely get to the box’s contents if the other individual dies.
It is common for married couples to have dual access to their co-held safe deposit box (although that gets sticky in a contested divorce). For single adults, it still makes sense to designate a joint holder – a grown child, friend, business partner, etc. — but make certain it is someone you trust completely. Remember, they will have authorized access to the box without your knowledge.
Talk to an experienced estate planning attorney
There are many complicating factors involving the contents of a deceased loved one’s safe deposit box, so it helps to seek the advice of knowledgeable attorneys and financial advisors early in the process.
The experienced elder law attorneys at Cordell Planning Partners specialize in affordable smart solutions for asset protection, wills, trusts, Power of Attorney documents, and many other essential aspects of estate plans.
Cordell Planning Partners also offers free educational workshops where we explain a range of estate plan options and asset-protection programs, all in terms that are easy to understand.
To learn more, contact us today. You can even schedule a free estate plan analysis to discuss your individual planning priorities.