A bank account held in trust for another person, also called a 'payable on death' account, where the account holder retains full control during their lifetime but the funds automatically transfer to the named beneficiary upon death. This arrangement avoids probate while allowing the depositor complete access to the funds.
Named after the 1904 New York case 'In re Totten,' which established the legal validity of these informal trust arrangements. The case involved a bank account opened 'in trust for' another person, creating a new category of revocable trust.
The beautiful simplicity: just add four words—'in trust for [name]'—to any bank account and you've created a trust that bypasses probate! This 'poor man's trust' costs nothing to set up but provides the same probate-avoidance benefits as expensive formal trusts, making it incredibly popular for simple estate planning.
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