Are my joint, trust, and business accounts insured?

What is an ownership category, and why does it matter?

An ownership category is the legal form in which a deposit is held, and it is the reason the same $250,000 limit can protect $250,000 for one person and $2 million for another. The FDIC insures $250,000 per depositor, per insured bank, per ownership category. Deposits combine only when they share the same owner and the same category at the same bank.

The FDIC does not care what you call the account or which product it is. Checking, savings, money market deposit accounts, and CDs are all just deposits. What matters is who legally owns the money and in what capacity. Get the titling right and coverage takes care of itself; get it wrong and you can be uninsured while believing the opposite.

Single accounts: money in your own name

A single account is a deposit owned by one person with no beneficiaries named, insured up to $250,000 per owner, per bank for everything in that category combined.

Worked example. Maria has $90,000 in checking, $140,000 in savings, and a $60,000 CD at the same bank, all in her name alone. That is $290,000 in one category, so $250,000 is insured and $40,000 is not. Opening a fourth account there would not help; moving $40,000 to a different bank, or to a different category, would.

Deposits held by an agent, custodian, or conservator for one person still belong to that person and fall in their single category — a Uniform Transfers to Minors account, for instance, is insured as the minor’s single account, not the adult custodian’s.

Joint accounts: two or more living owners

Each co-owner is insured up to $250,000 for their share, so a two-owner joint account is insured up to $500,000and a three-owner account up to $750,000. The FDIC assumes shares are equal unless the bank’s records state otherwise.

Three conditions have to hold for joint coverage:

• All co-owners are living people — not a company or a trust.
• Each co-owner has equal rights to withdraw.
• Each has signed the signature cardor the bank’s equivalent record (CDs and some electronically opened accounts are treated as satisfying this).

Worked example.Dev and Priya hold a $700,000 joint account at one bank. Each is insured for $250,000 of their $350,000 half, so $500,000 is covered and $200,000 is not. If they also each keep $100,000 in a single account at that bank, those balances are insured too — different category, untouched by the joint shortfall.

One correction people find surprising: a person’s joint coverage is calculated across all joint accounts at that bank. Opening three joint accounts with three different people does not give you three $250,000 limits; your shares in all of them add up against your one joint-category limit.

Trust and payable-on-death accounts

Deposits held in trust — including informal payable-on-death (POD) and in-trust-for accounts — are insured at $250,000 per eligible beneficiary, counting a maximum of five beneficiaries. That puts a hard ceiling of $1,250,000 per owner, per bank on this category.

The FDIC rule effective April 1, 2024merged what used to be two separate categories — revocable trusts and irrevocable trusts — into a single trust accountscategory running on that one formula. If you last read about “$250,000 per beneficiary with no cap” or about complex irrevocable-trust interest calculations, that guidance is out of date.

Worked example.Robert has a POD savings account naming his three children. Coverage is 3 × $250,000 = $750,000, so a $700,000 balance is fully insured. If he named eight grandchildren instead, coverage would stop at 5 × $250,000 = $1,250,000, not $2 million.

What counts as an eligible beneficiary?

A living person, a charity, or a nonprofit organization — named in the bank’s deposit account records or in the trust document the bank has on file. Naming your own estate, or naming a beneficiary only in a will, does not create beneficiary coverage. And note that adding a POD designation moves the money out of your single category rather than adding a layer on top of it.

Irrevocable trusts

Since the 2024 rule, deposits of an irrevocable trust are insured under the same trust accounts formula: $250,000 per beneficiary, up to five, per grantor, per bank. The old approach of valuing each beneficiary’s non-contingent interest no longer applies to these accounts. Trusts with unusual structures are still worth checking directly with the bank, since the coverage follows the deposit records the FDIC will actually read.

Certain retirement accounts

Retirement deposits get their own $250,000 per owner, per bank, entirely separate from your everyday accounts. The category covers traditional and Roth IRAs, SEP and SIMPLE IRAs, self-directed Keogh plans, self-directed defined contribution plans such as many 401(k)s, and section 457 plans.

Worked example.Ana has a $200,000 traditional IRA and a $120,000 Roth IRA, both held as bank deposits at the same institution. Those combine to $320,000 in one category, so $250,000 is insured and $70,000 is not — even though her $180,000 personal savings account at that same bank is fully covered in a different category.

The frequent misunderstanding: only the deposit portion of a retirement account is insured. Mutual funds, stocks, bonds, and annuities held inside an IRA carry no FDIC insurance at all, whoever sold them to you.

Employee benefit plan accounts

A plan’s deposits are insured on a pass-throughbasis: each participant’s non-contingent interest in the plan is insured up to $250,000, rather than the whole plan sharing one limit.

Worked example.A pension plan holds $2,000,000 on deposit for 40 participants with roughly equal interests. Each participant’s $50,000 interest is well under $250,000, so the entire $2,000,000 is insured. Pass-through coverage depends on the bank meeting capital requirements at the time of deposit and on the plan records identifying participants’ interests, so it is worth confirming with the bank rather than assuming.

Business accounts: the category that surprises everyone

The answer turns entirely on whether the business is a separate legal entity. A corporation, LLC, partnership, or unincorporated association is its own depositor with its own $250,000. A sole proprietorship or DBA is not— that money is insured as the owner’s single account.

Sole proprietorships and DBAs

Worked example.Sam runs a landscaping business as “Greenline Yards,” a DBA with no LLC behind it. He holds $180,000 in the business account and $120,000 in personal savings at the same bank. The FDIC treats both as Sam’s single-category deposits: $300,000 in one bucket, so $50,000 is uninsured. Nearly everyone who runs a business this way assumes the opposite.

Corporations, LLCs, and partnerships

Worked example.Sam forms Greenline Yards LLC and the account is retitled to the entity. Now the LLC is a separate depositor with its own $250,000, and Sam’s personal $120,000 is insured separately. Both balances are fully covered at the same bank.

The conditions and the limits of that trick:

• The entity must be validly formed and engaged in an independent activity— a shell created mainly to expand insurance coverage does not qualify.
• Divisions and DBAs of one entity are not separate. Three brand names under one LLC share a single $250,000.
• Two genuinely distinct entities are separate, even with identical ownership. Two real operating LLCs get $250,000 each.
• An entity’s deposits are insured separately from the personal accounts of its owners, members, or partners.

Government and public unit accounts

Deposits of a government body — a school district, a municipality, a state agency — are insured to $250,000 per official custodian, the person legally authorized to administer the funds, rather than per account or per agency.

There is an in-state wrinkle worth knowing: when the public unit deposits at a bank located in the same state, the custodian’s time and savings deposits get $250,000 and demand deposits get a separate $250,000. If the bank is out of state, all deposit types share a single $250,000 for that custodian.

Common mistakes that quietly cost coverage

• Assuming a DBA is a business.Sole proprietorship money adds to the owner’s personal single accounts. This is the single most common miss.
• Opening more accounts in the same category. Four savings accounts in your own name at one bank share one $250,000.
• Counting branches as banks.Every branch of an insured bank is the same bank. Two brand names on one FDIC certificate are also the same bank — check the cert number on a BankSonar bank profile.
• Beneficiaries that are not in the bank’s records. Coverage is calculated from the deposit account records, not from your estate plan.
• Adding a POD and expecting it to stack. The designation moves the deposit into the trust category rather than adding to your single coverage.
• Forgetting accrued interest. Principal plus interest through the date of failure counts, so a balance sitting exactly at $250,000 will drift over it.
• Treating investments as deposits. Mutual funds, annuities, and securities bought through a bank are never FDIC-insured.

How to check your own coverage

Pull up every account at one bank, label each with its ownership category, add the balances within each category, and compare each total against $250,000 per owner. Anything over the line is either a candidate for a different category or for a different bank. The FDIC insurance calculator does that arithmetic for you, our bank safety guide covers what to do with the answer, and how to insure more than $250,000 walks through the stacking strategies with full worked examples. If your money is at a credit union, the same structure applies through the NCUA — see FDIC vs NCUA.

Frequently asked questions