Heirs Confused Managing Sudden Inheritance
Individuals are experiencing frustration and confusion navigating the process of receiving inherited IRAs, particularly when dealing with estate splitting and multiple beneficiaries. The complexity of legal and financial procedures following a family member's passing creates significant stress and uncertainty.
SOURCES (60)
“Hi friends, A close relative who passed last year had more investments than I’d thought. I have received roughly 500k. 83K in Inherited IRA / Inherited Roth, 395 in brokerage. Additional sales of assets (in progress) will bring the total up to $500k. Context: 58m,…”
“We did this, gave 100k to my parents, they ended up using it as a deposit to buy a business and now they’re back on their feet again”
“It needs to either go into an account she is still on, if there is one, or an estate account .”
“I have some inheritance funds in a CD at a credit union where the funds were initially kept. It’s grown to about $120k. The CD is maturing soon and I’m debating whether to renew for another 12 months at 4.00% or take them out and place in a HYSA for around 3.4-3.6%? I’m afraid to lose out on the steady CD rates but I feel like putting in a HYSA makes them more accessible to me if I decide I want to invest or utilize the funds. submitted by /u/imaginaryaardvark_ [link] [comments”
“The process I followed as executor... Sign your name plus "executor to the estate of" (your mom's name). Deposit into an state account.”
“If you are the executor of your mother's estate, you can endorse it as the executor (and bring proof to the bank) and then endorse it again with your signature, you should be able to deposit it to your account. If the estate is in probate, you should be talking to the court as to how you need to handle the check. You should probably talk to someone at the bank and ask what the proper procedure would be.”
“If the check is rewritten, it should be made out to "the estate of Mothers full name"”
“If it’s a small amount and your mom’s estate is not in probate, you could ask your bank what their process is to deposit into your account. If your bank doesn’t have a local branch, it might be worth looking into one so that you can stop in anytime you have a complex situation like this.”
“Money is likely owed to your mom so it must go through her estate account. You can’t just endorse and deposit it. You can ask them to re-issue the check to have it payable to you but they likely won’t do that since they need to follow legal protocol with issuing the refund to the legally entitled individual, even if they passed.”
“Hi All, My father recently passed, and I’ve received an inheritance of about $500,000 via a Vanguard IRA. I’d greatly appreciate any feedback to help guide my next steps, so that I can make the best possible financial decisions. A summary of our finances me (41), wife (42): Married; joint tax filling – household income: gross: $217,000; net: approx. $136,000 ($11,400/month); joint back account only I work for a city government, receiving a state pension; wife is an RN, has a 401(a) Homeowner for”
“27 years old, was recently given 30k as an inheritance. Recent masters graduate in a STEM field with a job lined up starting at the end of the year. Will be around 140k starting, but I have accrued around 160k in graduate school federal student loans at 7% interest. I plan to apply for IDR after my grace period ends, which should grant me another 12 months until I have to repay. I do not have any other loans, debt, or large monthly bills currently aside from gas and food. I am currently living w”
“45 yr old, married, two kids, VHCOL area, $5.5M net worth including the house, $3.5M in 401K and brokerage. ~$900K HHI, split roughly 50-50 income between the two spouses. One job is medical, one job is semi-volatile/tech. We are both near the top of our likely income/career paths. We have received about $2M of inheritance on top of the above. We are debating trying to pick stocks, invest in real estate, etc. Our current plan is to dollar-cost-average the money over about 12 months into VTI. Our”
“I'm looking for outside opinions because I've gone back and forth on this. A family member recently passed away, and I'm receiving: * **$330,000** from a **non-spouse inherited traditional 401(k)** (I'll withdraw it over about **7 years** to spread out the taxes). * **About $150,000** from selling the house. * **About $50,000** from a checking account. Only the inherited 401(k) is taxable. At first, I wanted to keep the house because I currently live in it. But after learning the”
“My 80 year old mother is probably going to have to sell her beach house and will likely profit about 3.2 million dollars after capital gains and other taxes. She literally has no idea what to even do with that money. It's ultimately going to go to her 4 kids when she passes but in the meantime what does someone her age do with a lump sum like that? She is extremely frugal and has no interest in spending. She just wants to keep it as safe as possible. Or is there some way to have it grow a li”
“Get the trust. Especially with two kids, it will get very complicated without. 3k is about standard.”
“My father in law passed away a few weeks ago. There was a joint bank account with his brother (both he and his brother are over 80 yrs old), which had roughly $53,000. We start getting messages a few days before my FIL passed away from his brother that my FIL had withdrawn $50,000 from their joint account at the end of March. My FIL had Alzheimer's and while we didn't believe he was driving, technically, he "might" have been able to. They did not have any assistance in their ho”
“greetings, my family member and i received an inherited IRA from our father when he passed away, split evenly between us. we were told by fidelity that we have a COMBINED amount that we have to take for an RMD every year, but google said something slightly different - that EACH of us needs to take a required RMD every year. i am wondering if someone on here can confirm which is correct. thank you :) submitted by /u/Overall-Structure-21 [link] [comments]”
“I'm just brainstorming here but: It's legal to gift stock. It should be possible to have your brother open an account in his name, and ACAT 1/2 of the stocks directly to his account. It might be easier if both accounts were at the same brokerage. This would not count as a sale, so no taxes would be due immediately from either you or your brother. Instead your brother would receive the "gift" at your cost basis, and no taxes would be due until he sells it. Since the amount of th”
“This will vary a bit depending on the probate procedures in your state, but typically you’d distribute and just hold back what you need for taxes and fees (with as much of a buffer as you feel comfortable with) in a non-interest or minimal interest bearing account. Your attorney should give you specific guidance for your state.”
“Have a proper contract so you can have someone to blame when things go wrong”
“In a bit of a hairy situation, my father recently passed and while collecting stuff for his estate we’ve discovered that he had assets with crypto.com. We’ve spent two months attempting to get the money out however all we have gotten is various chatbots saying they will update us on our case only to never be reached again. Does anyone know how to actually get in touch with people affiliated with the company or in general how to go about a situation like this? submitted by /u/Such_Rin”
“The August 20 notice alone makes your attorney route the right move; deemed consent is not something to let slide when nobody has produced an inventory. Your father set up a structure with enforceable remainder interests, and moving everything to your mother outright would turn that into relying on whatever her later estate plan says and whether it changes. A narrower settlement about the house sounds far more proportional than dissolving the whole trust, especially with the trustee and POA role”
“Why didnt it get step up at death? Ah, now I remember you. It is inherited and managed by the same one that does the other family members. Do you have control over it in the first place to do anything about it if someone said "sell it all and invest in market ETFs because unless you leave your state your LTCG taxes will not be any lower later?"”
“Alright so for context, my dad got into investing and stocks about 20 years ago, around the time I was born. He opened an account for each of my siblings so it could start paying dividends for us from birth. Since then, he’s bought a lot of shares in different stocks and companies and is in my opinion of the smartest people I have ever met. He’s tried teaching us options, learning the system, investing in companies that provide stable and smart income, but most of us felt threatened by the thoug”
“Sounds to me like your financial advisor has skin in the game for you staying in debt and letting them "manage" your money - I don't want to assume too much or assume evil intent, but A reason for such advice is that the financial advisor makes money off of you staying in debt and investing with their products. IMHO you should pay off your credit cards and then cut them up (except for keeping maybe 1). After that, pay off the student loans - you mentioned that they are a burden (an”
“Your dad is basically saying he wants to hand you all the risk with none of the runway. That is not a gift, that is a trap. He built equity over decades using the cash flow YOU helped generate for 10 years. Walking away with the bank account empty while you inherit payroll obligations for 20+ people is him cashing out at your expense. The realistic ask: he leaves 2-3 months of operating expenses in the account. You buy the business at a fair valuation paid out over time from profits. If he drain”
“I'm looking for some advice for the below situation, or even just someone to point out considerations that I may not be thinking of. My wife and I were gifted securities by family. Currently $180,000 FMV with $75,000 URGL. The securities come from an Edward Jones FA, and some are in high expense ratio mutual funds. The most egregious being 1.27%, a few over 0.75%, and others over 0.5%. Ideally, I would prefer to be invested in VT. I'm trying to decide whether it is worth it to realize ca”
“I don't think anyone is saying to keep it private. This situation is probably more complicated than what you are able to gather, so why are you making assumptions? Things that I would ask: -Why is OP referring to their spouses retirement savings as "his retirement"? Legally speaking, that is both of their retirement. Even if OP did not have earned income, staying at home to raise kids is a joint sacrifice they made, and the value of that is both monetary and priceless from the home”
“What box the amount was put into really matters. Not all inherited money is non-taxable. Some inherited money is. Anything that would have been taxable to the deceased is taxable to the heirs. It is unlikely that the money was taxable based on your description. However the box that the amount was put into really does matter. I still don't understand how it is that the chancery court was issuing the payments if you were the administrator of the estate.”
“Want to keep this short. Back in 2023, I inherited roughly $30k that went through my local chancery court clerk. I recently found out this year that the court clerk filed the inheritance check as a 1099-MISC. A few months ago, I received a letter saying I owe taxes on the inheritance. Tried literally an entire day to reach a living, breathing human being at the IRS to attempt to sort this out and never could. I then uploaded documents explaining that this is inheritance along with all the docume”
“Hello everyone! I've got a question related to setting up withdrawals for an inherited Roth & 401K. I had a family member who passed away two years ago and I was the sole person (In my late teens/early 20s) responsible for administering the estate. I've managed to get everything in order and wrapped up and transferred over, however I'm left with an Inherited Roth and 401K that I need to begin taking withdrawals from. I'm aware of the 10 year withdrawal rule, so I've got 8”
“Pay off the debt and put the rest in a HYSA as an emergency fund. Stop getting into credit card debt. That is how you honor this gift from your parents. Use it to set you up for life.”
“My last surviving parent passed away in their 60’s recently, thinking they had left us nothing. They had no savings and were never really well-off but got by ok. I found out that they had a life insurance policy that my siblings and I each benefited from, completely unexpectedly! This is likely a once in a lifetime opportunity, and I want to make the best possible decisions with it. I have about $23,000 in student loans at 6.8% interest and 11.5% interest for about $5,000 of that. I have about $”
“My wife (24F) and I (24M) have a young son together. We’re doing well financially and have been for some time. Over the years, my wife lost several close family members, and many of them left her portions of their estates, which she gains access to when she turned 25. I’ve always viewed that money as entirely hers and have never had any interest in treating it as part of our shared assets. It has already paid for her college and the down payment on her car. I made it clear from the beginning tha”
“Follow this: https://www.reddit.com/r/personalfinance/wiki/commontopics/ There are no tax implications. Parents don't even need to report to IRS as it is below the reporting threshold (assuming they haven't made other large gifts this year.)”
“A bit of context: I'll be receiving an inheritance in the next few months. I'd trade every penny of it to have this person around for longer, but unfortunately that's not how life works. As one of the executors, I have a good idea of what I'll be receiving. My first priority is to clear any outstanding debts, mainly my car loan. Once that's paid off, my plan is to redirect that monthly payment into a dividend-focused pie on Trading 212 or a selection of individual shares. I&#”
“Does OP get the exemption from it being a principal residence, or was his occupancy too short.”
“No is a full sentence. You can also cop out and say for the sake of the family peace we will use someone else”
“I would never place any money with any family member. They tend to overstep their bounds and try to influence your decisions. I think of our financial advisor as a helper...he provides options, we make the decisions. For example, if we need X amount of money for something, he looks at our account and provides a few options on how we can be accommodated...he never even asks what the money is for. The most he's ever asked is if it can wait 3 months til a particular investment matures...if not”
“You should find a CPA - these are questions that could cost or save you tens of thousands of dollars.”
“The basis steps up to FMV at the time your grandmother passed, so your gain is only the appreciation since then minus any improvements and selling costs. Two years isn't a huge window, you might owe a bit but not a horror show. A local appraiser can run comps for the date of death, but with an offer expiring tomorrow that's a tight ask. A 1031 is for investment property, and you need a qualified intermediary in place before you accept the offer, so you'd be scrambling hard.”
“I inherited a house from my grandmother, two years ago in May. I lived there for about a year after inheriting. There was a transfer on death put in place before she passed. What can I expect to pay in capital gains? How do I find out the value of the home at her time of passing? Also thinking of using a 1031 exchange. Edit to add: it's listed and we have an offer good until tomorrow. submitted by /u/Comfortable-Heat454 [link] [comments]”
“I am completely new to all of this and extremely lost. I know nothing about finances and do not know what questions to be asking my financial advisor. I (21, located in Ohio, unemployed, filing single, independent) am the beneficiary of a Transfer on Death consisting of a stock portfolio with a value of over $220k. All are Class-A stocks. I have transferred the portfolio to an Individual Brokerage Account, and I would like to withdraw $48,000. What are the tax implications of doing such a thing?”
“As a CPA who has dealt with auditing the mishandling of trusts. This all sounds wrong. Wrong on a tax standpoint, wrong in terms of putting assets already protected back into a revocable trust status, which can be changed btw. I would say no. Get legal advice from a trust attorney, but nothing about this sounds right. Also you should have a trustee. You should have access to financials or statements. A year? I would request these ASAP. You should have a schedule A, as that was determined before”
“Parents set up a special needs trust for a disabled child. One parent has passed away, and the living parent would like to make changes (only adding a second remainder beneficiary). Trust manager says no changes can be made since both grantors can no longer sign off. Does this make sense? I would think the remaining grantor would retain full power during their lifetime. submitted by /u/adolissa [link] [comments]”
“I just got a paper in the mail, I’m 21 now, my dad had hidden my Grandmas 529 for me from me, it has 42k in it, I have 55k in loans. I knew it existed, but my dad lied and said it was empty, when I used it to pay for my first two years. I still can’t use it yet though because he locked it in an account where I need his permission to use it till I’m 32. If he dies the rights go to my step mother as far as I know. (that’s what they told me in the past and it still lists him as the owner on the pap”
“No. You cannot until the transfer of funds or ownership has been finished. If it is an utma account then generally you only need an id and death certificate provided you are the age of majority. However all of this can differ state to state and institution to institution. If something else applies you may need a court order to have the funds released.”
“Bring a copy of the death certificate too and you should be able to sign paperwork -- or find out what you need to do if it must go through probate.”
“We need to know the exact wording of the title. Just use xxx for names. If it says ITF, In Trust For, or POD, Payable on Death, yes, you can go to the bank and present an original death certificate, fill out their paperwork and they will issue you a check or retitle the account in your name. You should not transfer funds ahead of time. If you are a joint tenant, you now own the account and yes, you can transfer or access the funds without delay. You should still present the death certificate to”
“If you are listed as a minor - no. If your grandmother passed, it goes to probate.”
“This isn’t a sob story but I want to give background. I’ve been facing housing instability since I was 18, all my family is unsupportive or deceased. When my father passed away a few years ago I went through a bout of depression that put me in debt and I’ve been trying to recover. My credit is shit and I don’t know if bankruptcy is the answer because My income is not great, but I’m employed full time and have a side job. I recently got a few thousand dollars through a resource and I feel happy b”