How do you inherit money?

[Anonymous]

Anonymous wrote:My mom didn't own a home and every single bank account and pension listed me as a beneficiary so everything was easy. I distributed things equally between myself and my brothers.

Therefore YOU are the only legal beneficiary. Your siblings should have been listed as well.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My mom didn't own a home and every single bank account and pension listed me as a beneficiary so everything was easy. I distributed things equally between myself and my brothers.

Wouldn't you have to pay taxes when you gifted money from you to your siblings?

OP

Unless you are getting enough to trigger the estate tax, inheritances aren't taxable. The path it took to get to you doesn't really matter.

Wrong. Op was the beneficiary only. The accounts with listed beneficiaries do not go through probate. Therefore she gifted Money to siblings subject to gift tax if amount over threshold.

Sure, but as long as under $13 million it doesn't matter, there are no taxes due.

Only thing you have to do if over $17k in a year is report it on your taxes. Nothing due.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My mom didn't own a home and every single bank account and pension listed me as a beneficiary so everything was easy. I distributed things equally between myself and my brothers.

Wouldn't you have to pay taxes when you gifted money from you to your siblings?

OP

Unless you are getting enough to trigger the estate tax, inheritances aren't taxable. The path it took to get to you doesn't really matter.

Wrong. Op was the beneficiary only. The accounts with listed beneficiaries do not go through probate. Therefore she gifted Money to siblings subject to gift tax if amount over threshold.

Sure, but as long as under $13 million it doesn't matter, there are no taxes due.

Only thing you have to do if over $17k in a year is report it on your taxes. Nothing due.

Gift tax is 18% -40% over the annual limit of 17k (and 34k if married) plus penalties and interest if not paid. Also the gifter will be charged penalty for not reporting gifts. In the pp case they did not report $$ as gifts as when distributed to non-beneficiaries .IRS will come after you and you will be penalized.

[Anonymous]

^^^also the gifter needs to file gift tax returns (Form 709) for all gifts. Penalties for not filing.

[Anonymous]

Anonymous wrote:^^^also the gifter needs to file gift tax returns (Form 709) for all gifts. Penalties for not filing.

You are misinterpreting the code, which is very confusing, admittedly.

1. Anything up to $18k in a calendar year is excluded from gift tax reporting. If you give someone $18k in 2024, you don't have to report it, or keep track of it in any way.

2. Anything OVER $18k in a year means, yes, you need to do form 709, and the amount over $18k (say $82k if you gave $100k total), would in theory be subject to gift tax.

3. However, as long as you keep records and note it in the filing, and amounts that total under $13 million lifetime to a single person are not taxable.

https://www.nerdwallet.com/article/taxes/gift-tax-rate

"For example, if you give your brother $50,000 in 2024, you’ll use up your $18,000 annual exclusion. The bad news is that you’ll need to file a gift tax return in 2025, but the good news is that you probably won’t pay a gift tax. Why? Because the extra $32,000 ($50,000 - $18,000) simply counts against your lifetime exclusion. Next year, if you give your brother another $50,000, the same thing happens: you use up your annual exclusion and whittle away another portion of your lifetime exclusion."

[Anonymous]

Anonymous wrote:

Anonymous wrote:^^^also the gifter needs to file gift tax returns (Form 709) for all gifts. Penalties for not filing.

You are misinterpreting the code, which is very confusing, admittedly.

1. Anything up to $18k in a calendar year is excluded from gift tax reporting. If you give someone $18k in 2024, you don't have to report it, or keep track of it in any way.

2. Anything OVER $18k in a year means, yes, you need to do form 709, and the amount over $18k (say $82k if you gave $100k total), would in theory be subject to gift tax.

3. However, as long as you keep records and note it in the filing, and amounts that total under $13 million lifetime to a single person are not taxable.

https://www.nerdwallet.com/article/taxes/gift-tax-rate

"For example, if you give your brother $50,000 in 2024, you’ll use up your $18,000 annual exclusion. The bad news is that you’ll need to file a gift tax return in 2025, but the good news is that you probably won’t pay a gift tax. Why? Because the extra $32,000 ($50,000 - $18,000) simply counts against your lifetime exclusion. Next year, if you give your brother another $50,000, the same thing happens: you use up your annual exclusion and whittle away another portion of your lifetime exclusion."

Also to note, this is why someone who say gets a $200k.gift from their parents for a down payment, the parents don't owe gift tax on it (assuming below the lifetime max exclusion).

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My mom didn't own a home and every single bank account and pension listed me as a beneficiary so everything was easy. I distributed things equally between myself and my brothers.

Wouldn't you have to pay taxes when you gifted money from you to your siblings?

OP

Unless you are getting enough to trigger the estate tax, inheritances aren't taxable. The path it took to get to you doesn't really matter.

Wrong. Op was the beneficiary only. The accounts with listed beneficiaries do not go through probate. Therefore she gifted Money to siblings subject to gift tax if amount over threshold.

Sure, but as long as under $13 million it doesn't matter, there are no taxes due.

Only thing you have to do if over $17k in a year is report it on your taxes. Nothing due.

Gift tax is 18% -40% over the annual limit of 17k (and 34k if married) plus penalties and interest if not paid. Also the gifter will be charged penalty for not reporting gifts. In the pp case they did not report $$ as gifts as when distributed to non-beneficiaries .IRS will come after you and you will be penalized.

?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My mom didn't own a home and every single bank account and pension listed me as a beneficiary so everything was easy. I distributed things equally between myself and my brothers.

Wouldn't you have to pay taxes when you gifted money from you to your siblings?

OP

Unless you are getting enough to trigger the estate tax, inheritances aren't taxable. The path it took to get to you doesn't really matter.

Wrong. Op was the beneficiary only. The accounts with listed beneficiaries do not go through probate. Therefore she gifted Money to siblings subject to gift tax if amount over threshold.

Sure, but as long as under $13 million it doesn't matter, there are no taxes due.

Only thing you have to do if over $17k in a year is report it on your taxes. Nothing due.

Gift tax is 18% -40% over the annual limit of 17k (and 34k if married) plus penalties and interest if not paid. Also the gifter will be charged penalty for not reporting gifts. In the pp case they did not report $$ as gifts as when distributed to non-beneficiaries .IRS will come after you and you will be penalized.

This is NOT true. Surprisingly a lot of average middle class Americans really think they can’t give or receive more than 17k without paying a tax.

Nope. All the limit is for is to prevent wealthy people from giving away all their money right before they die to avoid the estate tax. Any money given over $17k reduces the estate tax exclusion amount.

[Anonymous]

Anonymous wrote:This is a very simple set of tasks. There's absolutely no need for an estate atty, a trust or even probate. Lotta bad advice on this thread.

Close as many accounts as you can now. If you don't have a power of attorney document, do that now. All you need is a notary not a lawyer.

Yes, keep the joint account open to pay all his bills then split the remainder with sibling. Once it's empty, close it.

Is there a house that you have to sell?

PP obviously means to use a power of attorney while your dad is alive. The second a person dies, their power of attorney ceases to be applicable.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My mom didn't own a home and every single bank account and pension listed me as a beneficiary so everything was easy. I distributed things equally between myself and my brothers.

Wouldn't you have to pay taxes when you gifted money from you to your siblings?

OP

Unless you are getting enough to trigger the estate tax, inheritances aren't taxable. The path it took to get to you doesn't really matter.

Wrong. Op was the beneficiary only. The accounts with listed beneficiaries do not go through probate. Therefore she gifted Money to siblings subject to gift tax if amount over threshold.

This is OP. I wasn't the only beneficiary. That was someone else talking about that. My parent hasn't died yet.

OP

[Anonymous]

Anonymous wrote:

Anonymous wrote:^^^also the gifter needs to file gift tax returns (Form 709) for all gifts. Penalties for not filing.

You are misinterpreting the code, which is very confusing, admittedly.

1. Anything up to $18k in a calendar year is excluded from gift tax reporting. If you give someone $18k in 2024, you don't have to report it, or keep track of it in any way.

2. Anything OVER $18k in a year means, yes, you need to do form 709, and the amount over $18k (say $82k if you gave $100k total), would in theory be subject to gift tax.

3. However, as long as you keep records and note it in the filing, and amounts that total under $13 million lifetime to a single person are not taxable.

https://www.nerdwallet.com/article/taxes/gift-tax-rate

"For example, if you give your brother $50,000 in 2024, you’ll use up your $18,000 annual exclusion. The bad news is that you’ll need to file a gift tax return in 2025, but the good news is that you probably won’t pay a gift tax. Why? Because the extra $32,000 ($50,000 - $18,000) simply counts against your lifetime exclusion. Next year, if you give your brother another $50,000, the same thing happens: you use up your annual exclusion and whittle away another portion of your lifetime exclusion."

This is good to know! We've limited to the $17K last year and $18K this year, but it looks like we don't have to do that after all.

[Anonymous]

Anonymous wrote:

Anonymous wrote:^^^also the gifter needs to file gift tax returns (Form 709) for all gifts. Penalties for not filing.

You are misinterpreting the code, which is very confusing, admittedly.

1. Anything up to $18k in a calendar year is excluded from gift tax reporting. If you give someone $18k in 2024, you don't have to report it, or keep track of it in any way.

2. Anything OVER $18k in a year means, yes, you need to do form 709, and the amount over $18k (say $82k if you gave $100k total), would in theory be subject to gift tax.

3. However, as long as you keep records and note it in the filing, and amounts that total under $13 million lifetime to a single person are not taxable.

https://www.nerdwallet.com/article/taxes/gift-tax-rate

"For example, if you give your brother $50,000 in 2024, you’ll use up your $18,000 annual exclusion. The bad news is that you’ll need to file a gift tax return in 2025, but the good news is that you probably won’t pay a gift tax. Why? Because the extra $32,000 ($50,000 - $18,000) simply counts against your lifetime exclusion. Next year, if you give your brother another $50,000, the same thing happens: you use up your annual exclusion and whittle away another portion of your lifetime exclusion."

Thank you. The Admin needs to pin this post. So many people get this wrong.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Also, he should use any points on his credit cards. They will not be there after he passes away.

What ?
Who cares about this ?

My kids should. I have enough points for them to get flights to my funeral for free.

[Anonymous]

Anonymous wrote:

Anonymous wrote:My advice is hire an attorney to do the executor stuff-we are doing it now and it’s a huge hassle even for an uncomplicated estate.

For example, probate clerk just informed us that we should have gotten everything in the house appraised even though all beneficiaries agreed in writing to donate everything.

So now we are trying to get an appraisal for the stuff we had hauled to goodwill based on random snapshots we have (at a cost of several thousand.)

Are you sure the probate clerk is correct? Most people don't have their stuff appraised.

Probate clerk is right. Most people do not do it. Get a lawyer -- never would have been questioned for not doing it. Would fill out papers correctly.