Payable-on-Death Deposit-Account Beneficiary Rules in Tennessee

At a glance

Requirements one by one

Accounts and designation

Section 45-2-704(b)(1) permits a person, or joint owners holding as tenants with right of survivorship, to make a written contract with a bank directing the account balance to one or more death payees after the last owner dies. The designation may use “P. O. D.” under § 45-2-704(b)(2). A savings association may use the same terms under § 45-3-515; § 45-4-406 applies the bank provision to credit-union POD share accounts and share deposits in trust. A separate deposit-in-trust route appears in § 45-2-704(a).

Payees, owner control, and survival

The owner keeps the rights to withdraw, assign, pledge, and delete or change a death payee during life; the payee's interest waits until the last owner's death and remains subject to claims the bank could assert against the owner (§ 45-2-704(b)(3)-(4)). The contract can vary the § 45-2-704(b)(5) defaults: a payee must survive the last owner, surviving payees divide the balance equally, and the balance remains in the last owner's estate if none survives. A living trust may be named as beneficiary; § 45-2-704(d) lets the bank request specified trust documentation before accepting that designation.

Change and payment

A death-payee change is valid only on the bank's prescribed form, in its prescribed manner, and with authorization from all owners then living (§ 45-2-704(b)(6)). An owner seeking to change a payee should use that process; a will by itself does not meet the statutory change method. After the last owner dies, § 45-2-704(b)(7) permits payment to each payee equally or to all as tenants in common, unless the contract provides otherwise. The payees' receipt discharges the bank. Under § 45-2-704(b)(9), the bank may require an official death certificate or other acceptable survival proof before paying.

What trips people up

A joint POD contract under § 45-2-704(b)(1) calls for survivorship tenancy among the owners. Naming several payees is a different question: the statute gives surviving payees equal shares by default but allows a different contract term. If payment is contested, § 45-2-704(b)(8) permits the bank to interplead funds in a court with jurisdiction. The separate trust-deposit route has a broader interpleader cost provision after the 2017 amendment to § 45-2-704(a)(5); 2017 Pub. Ch. 264, § 5 supplies that wording.

Common questions

Can the beneficiary withdraw while the owner lives? The death payee's interest does not vest before the last owner's death under § 45-2-704(b)(4); the owner retains account control under subsection (b)(3).

What if all named payees die first? Unless the contract says otherwise, § 45-2-704(b)(5)(C) leaves the balance in the last surviving owner's estate.

Can a living trust receive the balance? Yes. Section 45-2-704(d) permits it and allows the bank to request a trust certificate, affidavit, or other acceptable documents.

Statutes and sources

The verbatim passages and source URLs appear in the statutes entries above; each was accessed October 8, 2026.