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when a person dies and leaves everything to someone.if a 401k is left ,is it counted as part of the persons tax liability?
Filed under: Estate Planning
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when a person dies and leaves everything to someone.if a 401k is left ,is it counted as part of the persons tax liability?
Filed under: Estate Planning
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jwishz says: It is counted as part of their estate. It is not taxable to the recipient when ownership is transferred. If the value has increased when the beneficiary sells, there is a liability based upon the value at death and the value when sold
Jss says: The beneficiary of 401K must report any withdrawal from 401K as ordinary income on the tax return.
Read this: http://taxipay.blogspot.com/2008/02/tax-on-inheritances.html
Bob F says: It is part of the deceased’s estate and is therefore subject to taxation to the estate if the estate is very large.
When the non-spouse beneficiary takes distributions, they are taxable to that beneficiary. Rules are a lot more pleasant if it is inherited by the spouse, however.
Doctor Deth says: probably because even if he didn;t die, any money withdrawn from the account in later life would be taxable
v b says: The 401K is part of the estate. If the estate is large enough, it pays taxes. This is a wealth tax
The beneficiary of the 401K is *also* taxed when they get the money. This is an income tax. It’s not the same thing as a wealth tax, though if estate taxes were paid on the same money, there may be small schedule A deduction for the beneficiary.
probably because even if he didn;t die, any money withdrawn from the account in later life would be taxable
The beneficiary of 401K must report any withdrawal from 401K as ordinary income on the tax return.
Read this: http://taxipay.blogspot.com/2008/02/tax-on-inheritances.html
It is part of the deceased’s estate and is therefore subject to taxation to the estate if the estate is very large.
When the non-spouse beneficiary takes distributions, they are taxable to that beneficiary. Rules are a lot more pleasant if it is inherited by the spouse, however.
It is counted as part of their estate. It is not taxable to the recipient when ownership is transferred. If the value has increased when the beneficiary sells, there is a liability based upon the value at death and the value when sold
The 401K is part of the estate. If the estate is large enough, it pays taxes. This is a wealth tax
The beneficiary of the 401K is *also* taxed when they get the money. This is an income tax. It’s not the same thing as a wealth tax, though if estate taxes were paid on the same money, there may be small schedule A deduction for the beneficiary.