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Old 02-11-2020, 03:58 PM   #41
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I was just skimming through most of this thread, so I might have missed something here. But....did the OP say something about an IRA?

If so, be meticulous in how you handle the transfer. The IRS is very rigid about inheriting IRAs.

- Assume your mom was taking withdrawals, so as beneficiary you must continue those, but based on your age. Any tax adviser can help you with this, or just research it on the IRS website.

- Most important, be CERTAIN you instruct your designated financial institution to set up an Inherited IRA account to receive your mother's retirement account. Do not, under any circumstances, mix her assets into your own retirement account, nor take the assets in a check made out to you (with the laudable intention of opening a new IRA personally).

Inherited retirement accounts must always be kept separate, and the "cleanest" way to do it is to have the assets transferred directly between financial institutions, never personally touching it. The IRS just loves those unknowing inheritors who aren't aware of the rules so the Feds can claim the whole thing as income tax-liable, LOL.

My condolences to you on your mom's death. Dementia is so hard on families. You're right, it's something of a relief when you don't have to face an ever-worsening situation. It's a cruel disease and too often heart-breaking.
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Old 02-11-2020, 04:04 PM   #42
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I'm sure you're totally confused by now with all the conflicting advice, much of it wrong. From the facts you've given, you have no need for an estate account or a tax ID number for an estate. With all the assets payable to you there is nothing to be done other than to present death certificates and possibly file an individual tax return for your mother for 2019 and 2020. ...
+1 Drain most of the money in the joint account but keep it open in case a stray check or bill comes along.

And where Gill says possibly file individual tax returns for 2019 and 2020 I think it is because your mom's income may have been low enough that she didn't need to file an individual tax return.
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Old 02-11-2020, 04:24 PM   #43
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Golden Sunsets,

Sorry for the loss of your mother. I went through a similar process when my Dad died. He had a will but everything he had was POD/TOD or had beneficiaries so no need for probate.

In closing all his accounts, final tax return, etc I remember feeling that I was proud to be able to take care of things for him and wrap up his life. He was a money and details guy and he and I were on the same wavelength in regards to finances. I was happy to be the one to close the books for him.
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Old 02-11-2020, 04:54 PM   #44
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The only mistake I made in settling my MIL's estate was paying PA inheritance tax. I live in CA, have no ties to PA, and should have told them to come and get it
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Old 02-11-2020, 05:34 PM   #45
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For the accounts where you are beneficiary...
Can a bank account have a beneficiary or you are talking about the POD designation?
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Old 02-11-2020, 05:55 PM   #46
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Sorry for your loss. Although a lot of the advice here makes this process sound easy, I would still hire an attorney. An estate attorney practicing in the state that your mother lived in.

We recently hired an estate attorney to prepare a trust and POA for my MIL. Money was well spent. The attorney had tons of good advice on issues I had no knowledge of, even though I handled my father’s estate in the early 1990’s. Things change and it makes sense to get professional help to make sure everything is done right.
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Old 02-11-2020, 06:10 PM   #47
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I'm sure you're totally confused by now with all the conflicting advice, much of it wrong. From the facts you've given, you have no need for an estate account or a tax ID number for an estate. With all the assets payable to you there is nothing to be done other than to present death certificates and possibly file an individual tax return for your mother for 2019 and 2020.


As full disclosure, I'm a trusts and estates attorney and a CPA and have administered simple and complex estates my entire career.


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+2

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Originally Posted by zippy2020 View Post
I was just skimming through most of this thread, so I might have missed something here. But....did the OP say something about an IRA?

If so, be meticulous in how you handle the transfer. The IRS is very rigid about inheriting IRAs.

- Assume your mom was taking withdrawals, so as beneficiary you must continue those, but based on your age. Any tax adviser can help you with this, or just research it on the IRS website.
I believe the bolded part above is incorrect under the SECURE Act. Since OP's mother passed this year, the new rules take effect. OP has 10 years to empty out the inherited IRA.

8 Moves to Consider for IRAs, 401(k)s Under New Secure Act

Quote:
Before the Secure Act, if you inherited an IRA from someone other than your spouse, you were required to take distributions from that account, but you could stretch out those payments over your entire life.

Under the new law, if an IRA owner dies in 2020 or after, the account’s beneficiaries must take all of the money out of the inherited IRA within 10 years after the year of the death. (Some beneficiaries, including spouses and minor children, are exempt from this rule.)
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Old 02-11-2020, 06:33 PM   #48
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I filed a return for mom for 2018 which resulted in a zero tax liability as her Memory Care facility costs dwarfed her income. 2019 will be the same. 2020 for 32 days I expect will be the same. Care costs dwarf income.
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Originally Posted by pb4uski View Post
+1 Drain most of the money in the joint account but keep it open in case a stray check or bill comes along.

And where Gill says possibly file individual tax returns for 2019 and 2020 I think it is because your mom's income may have been low enough that she didn't need to file an individual tax return.
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Old 02-11-2020, 06:43 PM   #49
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I filed a return for mom for 2018 which resulted in a zero tax liability as her Memory Care facility costs dwarfed her income. 2019 will be the same. 2020 for 32 days I expect will be the same. Care costs dwarf income.
You still may be required to file a return.
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Old 02-11-2020, 06:45 PM   #50
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I filed a return for mom for 2018 which resulted in a zero tax liability as her Memory Care facility costs dwarfed her income. 2019 will be the same. 2020 for 32 days I expect will be the same. Care costs dwarf income.
Makes sense.
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Old 02-11-2020, 07:15 PM   #51
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One final cavaet:

I changed her mailing address to mine. BIG MISTAKE! She loved to donate to charities and I STILL get requests 8 years later. If you change her mailing address use a PO Box.
There’s a “deceased do not mail” list. Take a death certificate to the post office and they’ll fix things up. I changed late DF’s address to mine and started getting junk mail for Mom, who died 22 years earlier.
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Old 02-11-2020, 07:21 PM   #52
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Oh, but don’t be too quick to add the recently deceased to a do not mail list. Bills, checks, and such might trickle in for a while.
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Old 02-11-2020, 07:58 PM   #53
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There’s a “deceased do not mail” list. Take a death certificate to the post office and they’ll fix things up. I changed late DF’s address to mine and started getting junk mail for Mom, who died 22 years earlier.

https://www.ims-dm.com/cgi/ddnc.php
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Old 02-11-2020, 09:28 PM   #54
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Yep. Funeral director notifies SS, he tells me. There are three SPIA annuities with no residual. My plan is to call the bank, the brokerage, the three annuity companies, the two pensions, the Life Insurance Company and the IRA administratior, once I have the dealth certificates and follow their instructions on what to do next. I've also notified her dental insurer. Do I have to notify Medicare - does anyone know? She has a United Health medicare Advantage Plan. I assume I should notify them as well?
When my DM passed, I contacted SS directly, and they instructed me I had to return a pro-rata portion of her last check. They provided the $$ amount they wanted. So, that may need to be another call since your DM passed mid-month.
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Old 02-12-2020, 07:54 AM   #55
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I expect to.
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You still may be required to file a return.
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Old 02-12-2020, 07:59 AM   #56
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Thanks Nwsteve. But SS pays in arrears, so the 2/1 check was for January. She died on 2/8. The funeral director will notify SS electronically, probably already has and I assume there will not be a 3/1 payment as its still relatively early in the month.
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When my DM passed, I contacted SS directly, and they instructed me I had to return a pro-rata portion of her last check. They provided the $$ amount they wanted. So, that may need to be another call since your DM passed mid-month.
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Old 02-12-2020, 08:08 AM   #57
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I am sorry to hear about your loss.

Banks are obligated to return the funds under federal law and there is no action required on the part of a beneficiary/account co-owner.
Exflyboy5; I'm curious why you returned the SS. If she passed in the month of February, she was entitled to the February check, which was her January payment.
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Old 02-12-2020, 08:42 AM   #58
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SS retirement benefits are paid in arrears according to this SS booklet:

https://www.ssa.gov/pubs/EN-05-10077.pdf

Quote:
We pay Social Security benefits monthly. The benefits
are paid in the month following the month for which they
are due. For example, you would receive your July benefit
in August.
There are no pro-rata payments. From page 11:

Quote:
If a beneficiary dies

Let us know if a person receiving Social Security benefits
dies. We can’t pay benefits for the month of death. That
means if the person died in July, the check received in
August (which is payment for July) must be returned.
If the payment is by direct deposit, notify the financial
institution as soon as possible so it can return any
payments received after death.
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Old 02-12-2020, 12:39 PM   #59
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Exflyboy5; I'm curious why you returned the SS. If she passed in the month of February, she was entitled to the February check, which was her January payment.
Because there was an extra month's payment. Notification by the funeral home to SS folks didn't stop the extra payment. Plus you aren't entitled to the payment for the month of death (as previously mentioned).
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Old 02-12-2020, 11:55 PM   #60
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Get more copies of the death certificate than you think you'll need. They come in handy more often than you might expect.
It depends. I got a bunch of death certificates for my mom. I used exactly one of them. It wasn't that no one asked for a death certificate. They did. But everyone would take a copy or PDF except one place (that I don't recall). Some of the places wanted to see the actual death certificate (such as the bank) but they scanned it in and then returned it to me.

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Originally Posted by pb4uski View Post

Why would an EIN be needed if the beneficiary is an individual that already has a SSN that serves as their TIN?
I had to have an estate bank account as some checks were received that were payable to my mother's estate. To do this I needed an EIN. It was easy to get online.

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Originally Posted by Golden sunsets View Post
Seeing that I am the executor, is there any sort of paperwork that names me as Executor or PA, aside from the will itself. I am set to receive a dozen death certificates on Thursday. I have printed out the brokerage assets, cost basis and tax lots, as of date of death.

My DIL's father is an estate attorney and a friend. Mom and Dad's attorney has retired, so I think I'll set up an appointment with him or one of his junior associates and ask for advice on how to do this all myself. It won't hurt and I will have the comfort of knowing if I am missing anything.
I agree that consulting with a knowledgeable attorney in your state is important. Estate procedures vary from state to state. I was executor of my mother's will and I went through probate and received letters testamentary from the court. Even though I was the sole child and heir I was asked to provide copies of the letters testamentary on occasion while I was working on her estate. You will need to ask the attorney what procedure you will need to use in your case.


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Do I have to notify Medicare - does anyone know? She has a United Health medicare Advantage Plan. I assume I should notify them as well?
I was told that Social Security would notify Medicare. My mother had a supplement plan and the premium was paid for June right after she died toward the end of May. Same thing on her Part D plan. So I did need to get a refund from them of those premiums.
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