Parents dies with $1,300,000 net worth. Taxes? (creditors, house, sell, IRS)

[vabeachgirlNYC]

Originally Posted by Lowexpectations

There is some generic advice getting thrown around here and I’m not saying it’s bad but you could throw 500-1500 bucks at this and get actual legal advice and execution on what you need to do here

Yep. Also ask whomever you have insurance coverage (Personal/property) with because mine actually provides some services free of charge.

[Lowexpectations]

Originally Posted by vabeachgirlNYC

Yep. Also ask whomever you have insurance coverage (Personal/property) with because mine actually provides some services free of charge.

True or your benefits group through work. I can have a will drafted and executed for free through our benefits package

[westcoastforme]

Originally Posted by reed303

If any of the financial accounts are non-Roth IRAs or 401ks, son will owe taxes on RMDs from those accounts.

Research "Inherited IRAs". You could start here:

https://www.irs.gov/retirement-plans...-beneficiaries

Also be aware that on bank, etc accounts, a named beneficiary takes precedence over any will .

What’s RMD?


No worries only one boy who gets every penny!

[westcoastforme]

Originally Posted by Lowexpectations

There is some generic advice getting thrown around here and I’m not saying it’s bad but you could throw 500-1500 bucks at this and get actual legal advice and execution on what you need to do here

I don’t have a problem spending $500 bucks on a lawyer now. I wouldn’t want son sacked with $10,000 in lawyer fees later

[Elke Mariotti]

Originally Posted by westcoastforme

What’s RMD?


No worries only one boy who gets every penny!

RMD

Required Minimum Distribution

[johngolf]

Originally Posted by beachmouse

Note that if there's a conventional inherited IRA, he's now got ten years to spend it down and will pay taxes on that spend down.

However the transfer of such account(s) is pretty straightforward- it's a transfer to the designated beneficiary and doesn't have to go through probate and TurboTax and the like can handle his tax situation with that every year.

The majority of my wealth is in IRA's so I am aware of the 10 year spend down. I advised my heir (my son) so he is aware of it also. Let him and his accountant figure it out after I am gone.......LOL

[galaxyhi]

You can also gift him $15k this year without gift taxes to be paid.

If he's good with money, or willing to learn with you, and you're sure you're not going to need that $15k, you can slowly distribute funds to him.

The "free gift" exclusion may or may not increase each year so check each year on the IRS website.

Best as you plan

[reed303]

Originally Posted by westcoastforme

What’s RMD?


No worries only one boy who gets every penny!

When withdrawals (aka distributions) are taken from non-Roth IRAs and 401Ks, the deferred taxes must then be paid. For yourself the Required Minimum Distributions would probably start at age 72 now.

However the IRS rules for an Inherited IRA/401k are different. And again they are explained here:
https://www.irs.gov/retirement-plans...-beneficiaries

[johngolf]

Originally Posted by galaxyhi

You can also gift him $15k this year without gift taxes to be paid.

If he's good with money, or willing to learn with you, and you're sure you're not going to need that $15k, you can slowly distribute funds to him.

The "free gift" exclusion may or may not increase each year so check each year on the IRS website.

Best as you plan

I have been doing that. He and his wife do well. My $15K is just some icing on the cake.

[galaxyhi]

Originally Posted by johngolf

I have been doing that. He and his wife do well. My $15K is just some icing on the cake.

Nice of you!

My father also gifts me...not the $15k, but funds occasionally through the year.

I never count on it, and it's always a surprise when It comes!

Best to all...