While working in the corporate world, I opened joint bank accounts with my mom as co-owner so that she can transact banking needs in my behalf. I did not want to have to file a leave from work back then every time that I needed to sign or request anything from the bank. It was for making things more convenient.

It turns out that convenience has a price.

I recently came across an article in the local daily, The Philippine Star entitled, “Bank account of the ‘living’ dead.” I read that banks instantly freeze joint accounts in the event that one of the co-depositor dies.

Banks do this due to Section 97 of the Tax Code, which requires that a BIR certificate that estate taxes have been paid be presented. Only after this certificate is shown will the co-owner of the joint account be allowed to withdraw.

This becomes stressful to the surviving co-depositor especially if he/she has no other bank accounts in his/her name only and his/her only source of funds is the frozen joint bank account. The surviving depositor’s ability to buy for his needs like food and medicine or pay rent and tuition is curtailed.

The way out of this predicament, as written by the author of the column, is to place the bank account entirely in the name of dependent and avoid the joint accounts altogether. Or withdrawing everything before the death also works.

Read “Bank account of the ‘living’ dead” in full here.

Leave your comment below to tell us what you plan to do with your joint bank accounts after reading this post.

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