U.S. Savings Bonds of Decedent—Transferring Without Probate Administration

Recently, clients have come to us with U.S. Savings Bonds belonging to deceased relatives that they wanted to cash in.  The Bonds were titled in the name of the decedent alone.  It was too late to transfer them into trust or joint tenancy form or to make a “pay on death” arrangement.

Hoping to avoid Probate Court, they had asked for help from their bankers.  The bankers said that Letters Testamentary were needed. Probate Code Section 13100 Declarations were rejected.

Must a Probate Proceeding be opened to transfer a few U.S. Savings Bonds?  No. So long as the total value of the bonds or other treasury securities is $100,000 or less, they can be transferred using treasury form PD F 5336 E titled “Disposition of Treasury Securities Belonging to a Decedent’s Estate Being Settled Without Administration.”

A “Voluntary Representative” must complete and file with the Treasury the 5336 Form with a certified copy of the Death Certificate and the Securities to be cashed in or transferred.  The “Voluntary Representative” must be the “next of kin” as defined in Title 31 of the Code of Federal Regulations.  There is an order of precedence for Voluntary Representatives.  If there is a surviving spouse, that spouse must act.  If no spouse survives, then a child must act, and if no child survives, then a parent, and so on until the next of kin is determined and agrees to act.

The forms and instructions can be found on-line at www.treasurydirect.gov.

Lawrence L. Severson
Attorney at Law