depositor. If Form PS 300-B is incorrectly filled out, the depository office will send it and the certificates to originating postmaster for correction by the depositor. The originating postmaster shall return Form PS 300-B to the depository office when corrected and then deliver the certificates to the depositor.

(3) By agent for bankrupt organization. Accounts may be opened in the name of a bankrupt corporation, association, or individual and certificates may be issued if the agent or officer gives the post office a statement that local banks will not give the required security for bankruptcy funds.

(c) Identification data and signature. Information for identifying the holder when the certificates are presented for payment must be furnished. Fingerprints may be required. When the applicant usually signs his given name or names by initials, his full name must be written on the form and the application signed twice, first using the full name and then the initials or initial in the manner in which the account is to be maintained and certificates issued.

(d) Record of accounts-(1) Form. When an account is opened, a card record is established, a number assigned the account, and the record maintained as the official record of the account at the office where opened.

(2) Name. The applicant's name is entered on the account card in the manner in which the account is to be maintained and certificates issued.

(3) Change in name. A woman who marries after opening an account, or a depositor whose name is changed by court order, should so inform the postmaster and present all outstanding postal savings certificates to him. The depositor will be required to sign the new name on the record of the account, and the postmaster will annotate the certificates to show the new name. Until the depositor presents his or her certificates for proper notation, the postmaster, if aware of the change of name by marriage or by court order, will receive no further deposits for the account nor make any partial or interest payments but will make full payment to close the account if satisfied as to the depositor's identity.

(4) Entries. The amount of each deposit, the amount of each withdrawal and the balance on deposit are entered on the record.

§ 63.3 Ownership and privacy of ac

counts.

(a) Claims. When there is any dispute as to ownership, or a claim by other than the depositor is made for payment of a postal savings account, the postmaster will withhold payment of withdrawals from the account involved pending instructions from the Post Office Department in Washington.

(b) Ownership. The determination of any court of competent jurisdiction, unless appealed, is accepted as conclusive of title to postal savings account, and payment in accordance with such determination operates as a full and complete discharge of the United States from any further claim. An authenticated copy of the court determination must be submitted to the post office.

(c) Privacy of accounts. Postmasters and postal employees shall not disclose the name of any postal savings depositor nor give any information concerning a particular account to any person other than the depositor himself without specific authority, except that the balance on deposit may be given in the following circumstances:

(1) When a depositor is deceased or has been adjudged mentally incompetent, the information may be furnished to the duly appointed legal representative or next of kin.

(2) On the request of any State or county supervisor of old-age or unemployment assistance established pursuant to the Social Security Act of August 14, 1935, as amended, if the supervisor states he believes the applicant may have a postal savings account.

(3) When an applicant for relief has given written permission to representatives of relief agencies not connected with the Social Security Act of August 14, 1935, as amended, if the relief supervisor states he believes the applicant may have a postal savings account.

(4) On request of an Internal Revenue agent investigating a tax deficiency, if the agent has reason to believe the person may have a postal savings account. § 63.4 Deposits.

(a) Amount (1) Individual deposits. Deposits must be made in multiples of $5.

(2) Maximum balance. The maximum balance permitted, exclusive of accrued interest, is $2,500, except for deposits of

bankruptcy funds, where there is no limit.

(b) Interest-(1) Rate. Interest is payable at 2 percent per year.

(2) Start. Deposits begin to earn interest on the first day of the month following the date of deposit.

(3) Compound interest. Interest is compounded annually on whole dollar amounts on certificates issued on or after September 1, 1954.

(4) Simple interest. Certificates surrendered between annual periods, or for periods of less than 1 year, earn simple interest computed quarterly. Deposits made before September 1, 1954, earn simple interest until the certificates are surrendered or exchanged.

(5) Collection. The interest that accrues during any quarter is payable on or after the first day of the next quarter and may be collected by surrendering the certificate at the office of issue. However, the interest date for the certificate evidencing the redeposit will be the first day of the following month.

(6) Taxation. Interest credited to postal savings accounts on moneys deposited on and after March 1, 1941, is not exempt from Federal income taxes, but interest credited to postal savings accounts on moneys deposited prior to March 1, 1941, is wholly exempt from Federal income tax.

(c) Acceptance of funds. Funds shall be accepted the same as for money orders. (See § 61.1(b) (3) of this chapter.) A temporary stop payment notice shall be put on depositor's account card if a check is accepted. The depositor must return the certificates if the check fails to clear. Uncanceled savings stamps or old series postal savings stamps may be accepted. Funds shall be treated as postal funds.

(d) Issuance of certificates—(1) As evidence of deposits. Nontransferable and nonnegotiable certificates of deposit, in fixed denominations of $5, $10, $20, $50, $100, $200, $500, $1,000, and $2,500, are issued as evidence of deposits. Certificates are delivered to depositors when issued, and postmasters are not authorized to accept them after issue for safekeeping. The postal clerk shall:

(i) Verify account of individual kept on Form PS 600. Then enter depositor's name and account number on the certificate, and stamp the certificates with special postal savings stamp.

(ii) Issue certificates in consecutive numbers.

(iii) Record account number and date of issue on certificate book cover, and initial.

(2) Errors on certificates. If an error is found in a certificate after delivery to the depositor, the certificate should be returned to the issuing postmaster. The postmaster shall proceed as follows to correct errors on certificates:

(i) Discovered during accounting period of issue. Stamp certificates spoiled and write spoiled on cover page of certificate book opposite its serial number. Write the serial number of spoiled certificats on the daily Form 713 or Form 708, "Postal Savings Certificate Transactions Daily Summary" and on accounting period Form 704, or 714, "Postal Savings Certificate Transactions." Correct records if necessary. Send spoiled certificates with Forms 704 or 714 to the regional controller at the end of each accounting period.

(ii) Discovered after accounting period of issue. Make a receipt in duplicate, Form PS 305, "Depositor's Receipt for Certificates Surrendered Without Payment." (The supply of this form must be kept by the postmaster or a designated employee and delivered to the window in quantities estimated as a week's supply. Before being turned over to the window, the forms must be numbered in duplicate.) Give the original to the depositor, and file the copy with the depositor's card. Send the certificate and explanation of error to the regional controller. The regional controller will issue a new certificate with original serial number or correct the certificate and return it. Exchange the new or corrected certificate for the receipt held by the depositor. Correct the entries on the depositor's account, Form PS 600, if necessary. Match the receipt Form PS 305 returned by the depositor with the copy held with the depositor's card. Staple the two copies together, and hold both Forms PS 305 until audit by the station examiner of postal inspector.

§ 63.5 Making withdrawals.

(a) On demand at office of issue. All or any part of funds deposited at the office of issue may be withdrawn on demand. Immediate payment will be made, unless the amount is large and

the postmaster has to obtain the necessary funds. If a withdrawal is made within 1 month from the date of issue as shown on the certificate, a service charge of 20 cents will be made for each certificate regardless of denomination.

(b) In person. The certificates will be paid at the office of issue if the postmaster is satisfied as to the identity of the holder. The postmaster must

(1) Identify the depositor with the information shown on his account Form PS 600. Compare fingerprints if equipment is available.

(2) Compute interest and enter the amount due on certificate. (Use monthly interest tables, Schedule 100-B for 1939 or earlier series, and Schedule 100-C for 1954 series.)

(3) Have the depositor sign the certificates in the postmaster's presence.

(4) If the certificate is less than 1 month old, collect a 20-cent service charge and stick a 20-cent postage stamp near the right border, just above the word "thereon".

(5) Pay from postal funds, or use Treasury (symbol 0001) check where authorized.

(6) If any payment is questioned, give the depositor a receipt on Form PS 305 for the certificates, and send the account, certificates, and a statement to the regional controller.

(c) Through a representative—(1) Designated on Form 304 When personal appearance is not possible, the holder of the account may designate a representative to make a withdrawal. When it has been shown to the postmaster's satisfaction that the holder cannot appear in person, the postmaster will give the representative Form 304, “Authorization to Pay Postal Savings Through a Depositor's Representative", for the depositor to fill out and sign. When the executed order and endorsed certificates are presented to the postmaster, he shall compare signature and other identification data on Form 304 with that on the Form PS 600; satisfy himself as to the identity of the applicant and of the representative and that the depositor wishes to withdraw funds; and complete transaction as stated in paragraph (b) of this section.

(2) Powers of attorney. Powers of attorney will be accepted only when executed by members of the Armed Forces of the United States serving abroad and must be accompanied with a statement from the attorney-in-fact that the de

positor is still living and is stationed outside the United States. The papers will be submitted by the postmaster to the Department for approval and no payment will be made until he has received approval.

(d) By mail. Withdrawals may be made by mail, using Form 315, "Depositor's Application to Withdraw Postal Savings by Mail", which will be furnished by the postmaster. A postmaster must witness the signing of the Form 315. The depositor must mail Form 315 and the signed certificates to the office where his account is held (depository office). If the postmaster at the depository office is satisfied as to the applicant's identity, he will follow directions and instructions on Form 315, pay by check or money order, and send payment by registered mail, if requested, to the depositor-deducting any money order or registry fees. The depository office will file Form 315 with the depositor's account card, Form PS 600.

(e) Withdrawal of bankruptcy funds. Certificates must be endorsed by the depositing officer or agent (or his successor, whose appointment must be evidenced by a court order) and, in addition, may be countersigned by another individual in his representative court capacity if it is the requirement of the referee having jurisdiction over the funds in question.

(f) By nonresident aliens-(1) Definition. A nonresident alien is a depositor who sends an application for withdrawal from a location outside of the continental United States, or its possessions or military establishments. Withdrawal may be made by mail or through a representative. See paragraphs (c) and (d) of this section.

(2) Interest on deposits. The interest on deposits made after March 1, 1941, is subject to withholding tax if the postmaster does not have information that the depositor is a citizen of the United States.

(3) Method of payment. Instructions on Form 304 or 315 shall be followed. A Treasury check, drawn to the order of the Board of Trustees, Postal Savings System, for the full amount of principal and interest due, shall be sent to the Bureau of Finance (Postal Savings), together with a completed Form PS 320, "Letter Transmitting Postal Savings Payments by Mail," name and address of depositor and of representative, if any, and any new certificates. If no checking

credit has been granted, the regional distributing postmaster should be asked to draw a check in favor of the Board of Trustees, Postal Savings System, and to send it to the Bureau of Finance (Postal Funds Division). The Bureau of Finance will deduct the tax and mail the payment to the depositor or representative.

(g) By levy for deficiency in federal income tax. (1) A postmaster served with notice of levy by Internal Revenue agent shall—

(1) Put stop payment on account and notify depositor in writing of the levy served and request surrender of all or sufficient number of certificates to satisfy tax deficiency. Have depositor endorse certificates. Pay Internal Revenue Service and obtain receipt. File receipt with Form PS 600. Pay depositor any amount due on certificates above the amount of the levy.

(2) If certificates are not surrendered as requested within 10 days from date notice was mailed, prepare Form PS 607, "Depositor's Application for New Postal Savings Certificates," for duplicates for all or sufficient number of certificates to effect payment of levy. Attach notice of levy to Form PS 607 and send to regional controller. Regional controller will reissue certificates and retain notice of levy firmly attached to Form PS 607 as authority for reissue.

(3) When duplicates are received from regional controller, pay by check drawn in favor of the Internal Revenue Service. Obtain a receipt in duplicate for total amount paid. Enter on the margin of each unindorsed certificate "Paid Internal Revenue. See receipt enclosed." Enclosed receipt will serve in lieu of endorsement on certificates. Issue and mail to the depositor a check for any funds due him on a certificate where part of the amount represented by the certificate was used in payment of the amount set forth in the levy. Enter on the margin of that certificate $__. paid depositor by check No. will serve in lieu of a receipt.

This

(4) Treat paid certificates in usual manner. Annotate Form PS 600 to show that certificates were reissued and the purpose and that originals are void.

(h) Deceased depositors—(1) Accounts of $20 or less. A postmaster may, without specific authority, pay an account of $20 or less to the following upon presentation of proper evidence and written request by the applicant.

(i) Administrator or executor.

(ii) An entitled distributee or legatee on behalf of other distributees or legatees under a decree of distribution,

(iii) Surviving spouse, child, or parent, in the order named, or in the absence of any one of these, a brother or sister, if no administration on the depositor's estate has been asked for or granted.

(iv) The undertaker or other preferred creditor in the absence of administration or next of kin.

(2) Accounts over $20-(i) To whom payable-(a) Accounts that do not require administration. If a depositor dies intestate and the amount on deposit is $500 or less, or if the laws of the State in which the money is deposited provide either specifically or by court decision for the payment of a larger amount without administration, the next of kin, undertaker, person who paid the funeral expenses, or other preferred creditor may apply for payment.

(b) Accounts that require administration. When the amount on deposit is such that more than $500 will be available for distribution to heirs after allowing for payment of preferred claims, the amount due a deceased depositor in the final settlement of his account will be payable only to the legal representative appointed under the laws of the State in which the money is deposited, unless administration is not required by the State laws. Proper authority of the legal representative must be presented to the postmaster where the account is held..

(ii) Authority for payment. Certain large offices have been given specific authority by letter to pay accounts applied for by locally appointed administrators or executors. In all other cases at these offices and at all other offices, postmasters must report a depositor's death to the regional controller, using Form 1809, "Report of the Death or Incompetence of a Depositor", and await instructions before paying. All applications or legal papers that will be of assistance in settling the claim must be attached to the Form 1809. The following papers are necessary:

(a) When administration is required. (1) A legal representative must submit a court order certifying his appointment within the past year.

(2) A person designated by the court to receive the account must submit Form 1680, "Application for Payment of the

(1) Claim by a beneficiary under a will must (if the distributable balance is less than $500 and the State does not require the will to be probated) be submitted on Form 1680 with receipts mentioned in Form 1680, a certified copy of the will, and a Form 134, "Release", by each of the beneficiaries and/or entitled next of kin.

(2) Claim by one of the next of kin entitled by law to share in the estate, or by the person who paid the funeral expenses, must be submitted on Form 1680 if depositor dies without a will and not more than $500 will be available for distribution after allowing for payment of preferred claims. (Some States permit payment of a larger amount without administration.)

(3) Claim by undertaker or other preferred creditor must be submitted on Form 1672, "Application of Undertaker for Payment of Funeral Expenses From Funds to the Credit of a Deceased Depositor", with itemized statement of services rendered and a certification of claim by a responsible heir on Form PS 115-A, "Certification of Bill from Undertaker". The undertaker's receipted bill must be submitted if claimant is other than undertaker.

(4) Claim by foreign consular officer must be submitted on Form PS 112, "Application of Consular Officer for Payment of the Balance Remaining to the Credit of a Deceased Depositor", if the depositor is a United States resident, dies without a will, and is survived by alien heirs residing in a foreign country who are entitled to all or part of the amount of deposit.

(3) Payment. The signature of the payee(s) must be obtained on each certificate and on a receipt for interest due, in the following form: "John Doe by Richard Roe" (executor, widower, guardian, or other proper title). The account must be paid in full. The office copy of Form 1809 must be completed to show the date of payment, and must be placed with the paid certificate. (Clips or staples must not be used.) The amount of payment for accounts of $20 or less shall be endorsed on the written request of the applicant, and the request shall be placed with the paid certificate. (Clips or staples must not be used.) The

regional controller shall be advised if payment cannot be made.

depositors.

(i) Legally incompetent (1) The amount on deposit for mentally disabled or other legally incompetent depositors, other than minors, will be payable to the guardian, committee, conservator, or other legally appointed representative on presentation of proper evidence of appointment. A court order directing guardian to collect account of a minor is required before payment may be made to the guardian. When the depositor has been judicially declared incompetent and no guardian or other legal representative has been appointed and the gross value of the incompetent's estate is sufficiently small, application for withdrawal may be made by a State official or a member of the family if permissible under the laws of the State where the account is held.

(2) Postmasters at all offices shall handle claims for payment of accounts of legally incompetent depositors as provided in paragraph (h) (2) (ii) and (h) (3) of this section.

§ 63.6 Inactive accounts.

The main post office stations, and branches shall review Forms PS 600 once each year for inactive accounts and proceed as follows:

(a) Pull out accounts that have been inactive for 10 years. Whenever possible, turn them over to a supervisory official or designated employee who shall keep a control record of all accounts turned over to him. If inactive accounts cannot be taken from the custody of the postal savings clerk because of a limited office staff, they may be kept in the same file cabinet with the active accounts but shall be grouped separately. When a transaction occurs in an inactive account, return the account to the active files.

(b) Report accounts inactive or unclaimed for 20 years to the regional controller, and await instructions. Count the 20 years from date of last transaction or date of depositor's reply to an inquiry on Form PS 159 (now obsolete) whichever is later.

(c) When a depositor whose account has been transferred to the regional controller as unclaimed requests payment, furnish him a Form 315 and instruct him to complete and send it, together with the endorsed certificates, to the regional controller where the account is held. Payment will be made by the regional