Changes in FDIC Deposit Insurance Coverage

Transaction Account Guarantee Program

Deposits held in noninterest-bearing transaction accounts, low-interest NOW accounts, and IOLTA accounts are fully protected, regardless of the amount in the account. This full coverage is in effect through December 31, 2010, but only at institutions participating in the FDIC’s Transaction Account Guarantee Program (TAGP). Contact your financial institution to confirm its participation in the TAGP.

Beginning December 31, 2010 through December 31, 2012, deposits held in noninterest-bearing transaction accounts will be fully insured, regardless of the amount in the account, at all FDIC-insured institutions.

$250,000 basic FDIC insurance amount made permanent

The standard insurance amount is now $250,000 per depositor, per insured bank, per ownership category.

New Basic FDIC Deposit Insurance Limits for Common Ownership Types*

Single Accounts (owned by one person) $250,000 per owner
Joint Accounts (two or more persons) $250,000 per co-owner
IRAs and other certain retirement accounts $250,000 per owner
Revocable Trust (ITF/POD) Accounts $250,000 per owner per beneficiary subject to specific limitations and requirements
Corporation/Partnership/Organization Accounts $250,000

*For information on the requirements for these ownership categories, click on the Deposit Insurance FAQ section of EDIE

New FDIC Rules for Revocable Trust Deposits

The FDIC has adopted new rules that simplify how revocable trust deposits are insured. The new rules, which became effective on September 26, 2008, ensure that a revocable trust owner has at least as much coverage as he or she had under the former revocable trust account rules. The new rules change the calculation of coverage for revocable trust deposits in two significant ways:

First, the new rules provide that the owner of a revocable trust deposit is eligible to receive per-beneficiary coverage for any beneficiary named in the revocable trust, as long as the beneficiary is an individual, a charity or another nonprofit organization (recognized as such in the Internal Revenue Code).

Second, the new rules provide for a streamlined method of calculating insurance coverage depending on the number of beneficiaries who are entitled to receive the deposits when the trust owner (or owners) dies. Specifically, the rules provide that: