inheritance

Today I answer two questions related to inheritance: Dear Dr. Don, My husband and his sister inherited money and other property after their father's death last year. What is their basis in the money they received from his retirement funds, IRAs, stocks, sale of his house, etc.? -- Flummoxed Flo Dear Flo, The assets are valued either at the date of his death, or six months later (if Read more...

Dear Tax Talk, My mother is buying a new home using money from an inheritance. She doesn't have to sell her current house, but feels that she needs to in order to take advantage of the $250,000 capital gains tax deduction. She is afraid that she will not be able to claim the deduction after a few years of living in her new home or that the tax laws will change to pre-1997 levels. I Read more...

It's only human nature to postpone unpleasant chores. Some are easier to put off than others. While there are obvious consequences to not emptying a diaper pail, there may appear to be no downside to leaving your 401(k) alone when it's time to clean out your workplace cubicle and move on. But for most people who choose this path, the consequences are far more hazardous than smelling stinky Read more...

By Jeff Fleming ThirdAge Money Expert Question: My parents are in their late 80s and only have individual wills to each other. Mother has assets totaling about $500,000, and Dad over $1.6 million. They don't like trusts for the cost. I am afraid their estate will lose over 50 percent above the $675,000 deduction. What can I tell them to do immediately? I am thinking about a bypass trust first, Read more...

Question: I'm 57 years old. After I "retire" this year from my current employer, I plan to become self-employed. I have set up an IRA account to rollover my lump sum retirement benefit from my current employer. The wrinkle is that I'm receiving a substantial inheritance from my mother's trust fund within the next calendar year. Can I put the inheritance into the IRA along with the Read more...

Question: I understand that I can give up to $10,000 to a child without incurring a gift tax. The child assumes the original basis of the stock. Let's say I have some stock I purchased at $50 a share. Now it is at $70 a share. If I gift 100 shares of stock to one child, is it considered a $7,000 gift or a $5,000 gift? Do I pay capital gains tax on the $20 a share? Answer: Nearly everyone is Read more...

The friendly folks at IRS have become more aggressive when it comes to auditing gift and estate taxes -- so don't give them the chance to pry into your books. If you've decided to start parceling out your estate to your heirs now, rather than having your executor do it later, keep the tax consequences in mind -- and maintain good records, says Money.com tax expert Teresa Tritch. You can Read more...

So the big payoff is just around the corner -- how prepared are you? Whether it's the lottery, an inheritance or a major stock windfall, a little advance planning for that Jackpot would be prudent, says certified financial planner Rob Sanford. Some of his suggestions: If it's a lottery jackpot or an inheritance pay out, opt for a lump sum payment if you can, because you can invest that and Read more...