BBCWatcher
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2. What happens to one's portfolio if they suddenly pass away? Must we set up a will to account for these shares? Shares cannot be in dual name right?
Even a joint account can be/often is part of an account holder's estate when any account holder dies. That's a common point of confusion, and it comes up frequently in this forum. A joint account only legally passes to the surviving account holder(s) if it's a "right of survivorship" joint account.(*) Otherwise, a joint account only makes access to (comingled) assets more convenient. It doesn't indicate anything in particular about asset ownership and disposition to survivors.2. Your portfolio (if it's not a joint account) will form part of your estate and be distributed in accordance with your will
If the joint account holds U.S. estate taxable assets then the death of any joint account holder is a U.S. estate taxable event. Moreover, nearly always the whole joint account (100% of the fair market value of the whole account's U.S. estate taxable assets) forms the basis for the U.S. estate tax computation. For this reason you probably don't want a joint account when the account holds U.S. estate taxable assets. For example, a couple consisting of two non-U.S. persons could have one joint account with up to US$60,000 worth of U.S. estate taxable assets, and then the death of either account holder would result in zero U.S. estate tax owed (assuming that decedent did not hold any other U.S. estate taxable assets either jointly or individually). Anything above US$60,000 would be assessed estate tax. But if the couple has separate accounts then they can each hold up to US$60,000 of U.S. estate taxable assets (US$120,000 total) without their estates owing any U.S. estate tax.
If there's no valid will then the decedent's estate will be distributed according to applicable intestate laws. For assets in Singapore that's ordinarily the Intestate Succession Act, although if the decedent was Muslim then a different law applies.
(*) In the U.S. for example there's something called a "Payable On Death" ("POD") or "Transfer On Death" ("TOD") account. These POD/TOD accounts are not joint accounts, but when the account holder dies the account passes to the named beneficiary (or beneficiaries), outside of probate/will/intestate processes. Very similar to how CPF operates with named CPF nominees or how a life insurance policy operates with named beneficiaries. Most U.S. financial institutions offer POD/TOD accounts. As it happens, last year I inherited a portion of two U.S. POD accounts since I was one of the decedent's named POD beneficiaries. The decedent's will was not relevant to these particular assets. The financial institution just needed one official copy of the death certificate that covered all beneficiaries, my proof of ID, and that was that. Other countries often have similar choices available.
Also, in many countries (including the U.S.), residual pension-related assets — U.S. IRA and 401(k) accounts, for example — pass to the decedent's surviving legal spouse no matter what the decedent's will says. It's essentially a "mistress safeguard," that lawmakers didn't want a persuasive mistress (or consort) to help a boyfriend/girlfriend write his/her spouse out of his/her will and completely wreck that surviving spouse's financial situation. For any other arrangement the legal spouse must voluntarily agree, in writing, to surrender his/her legal right to pension-related assets. And that's exactly what happened last year, which is among the reasons I was so shocked and surprised. The decedent's surviving spouse voluntarily waived rights to the pension-related account, a precondition for attaching POD named beneficiaries to that account. The other account was not pension-related, but even so I was shocked there were any such POD accounts with my name on them. In case anyone is wondering, the surviving spouse simply decided there were/are more than enough other assets and felt strongly that these particular assets should pass to other loved ones, and without forewarning. So that's what they agreed to do. (Surprise!)