If you’ve received a Fidelity TOD letter in Louisiana (or something similar from another brokerage firm), you’re not alone — and the confusion is understandable. The notice usually says Louisiana doesn’t “recognize” Transfer on Death (TOD) registrations. The truth is more nuanced. Below is a plain-English guide to what’s going on and what Louisiana residents should know.
What Is a TOD (and How It’s Different from a POD)
A Transfer on Death (TOD) designation lets you name someone to receive your brokerage account after you pass away — without going through probate.
This is not the same as a Payable on Death (POD) account at your bank. PODs apply to checking or savings accounts, are fully recognized in Louisiana, and are not affected by this issue.
Didn’t Louisiana Change the Law?
Yes. For years, large investment companies like Fidelity and Vanguard offered TOD registrations to Louisiana residents even though our laws didn’t officially recognize them.
That changed on January 1, 2022, when Louisiana enacted La. R.S. 9:1711 et seq., which technically recognizes TOD registrations — but the law’s wording is complex and leaves some gray areas.
Because of this, some brokerage firms are now contacting clients to “clean up” or remove TOD designations they previously allowed. Fidelity’s letter states that Louisiana doesn’t recognize TOD accounts, but that’s not entirely accurate.
Registration vs. Ownership (Why the Letters Are Going Out)
The real issue lies in the difference between registration and ownership under Louisiana law.
- Registration is just a label on the account.
- Ownership determines who legally inherits the asset at death.
A TOD designation affects the registration only — it doesn’t override what’s written in your Will or who would inherit under intestacy (if you die without one).
That’s why some firms, including Fidelity, are choosing not to accept new TOD designations for Louisiana clients — the potential for confusion and dispute is high.
What This Does Not Affect
This issue applies only to non-retirement brokerage accounts. It does not affect beneficiary designations on:
- 401(k) and 403(b) retirement plans
- Traditional and Roth IRAs
- Annuities
- Life insurance policies
Louisiana continues to fully recognize these beneficiary designations.
What To Do If You Received the Fidelity Letter
- Don’t panic. Your funds aren’t frozen, and nothing is immediately wrong with your account.
- Don’t make quick changes. Talk with your estate-planning attorney before removing or updating beneficiaries.
- Check for consistency. If the person named on your TOD is also the person who inherits in your Will, you’re likely fine.
- If they differ, fix it. Ask your attorney about a codicil (amendment) to your Will or whether a revocable living trust would make things clearer.
- Stay informed. Some firms are refusing new TOD registrations in Louisiana — and that’s likely the right move until the law becomes clearer.
The Smoothest Path for Most Families
Because TOD designations in Louisiana are registration-only, the safest and simplest way to make sure your assets transfer the way you intend is through a revocable living trust or a properly drafted Louisiana Will that coordinates with your account titles.
Our attorneys can review your plan and ensure everything works together under Louisiana law.
Schedule a review: morrisonlawplc.com • (504) 831-2348
Frequently Asked Questions About the Fidelity TOD Letter in Louisiana
Does Louisiana recognize TOD accounts?
Since January 1, 2022, Louisiana law (La. R.S. 9:1711 et seq.) technically recognizes TOD registrations — but they don’t change who owns the account at death. Your Will or intestacy law still determines who inherits.
Are bank POD designations affected?
No. Payable on Death (POD) designations on bank accounts are still valid and recognized.
Do retirement accounts lose their beneficiaries?
No. Beneficiary designations on 401(k), IRA, annuity, and life insurance accounts remain fully recognized in Louisiana.
Should I remove my TOD?
Don’t make changes until your attorney reviews your full estate plan. If your TOD and Will list different beneficiaries, your lawyer can align them with a codicil or trust.
Will a revocable living trust avoid probate in Louisiana?
Yes — when properly funded, a revocable living trust can help avoid probate and keep your plan consistent with Louisiana law.
Legal Disclaimer
The information in this article is provided for educational purposes only and is not intended as legal advice. Reading this post does not create an attorney-client relationship with Morrison Law Group, PLC or any of its attorneys. Because Louisiana’s laws are unique and subject to change, you should not rely on this information to make decisions about your own estate plan or account designations without first consulting a qualified Louisiana estate-planning attorney.
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