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  • POD or TOD accounts and inheritance tax

    From ____@21:1/5 to All on Tue May 24 11:14:12 2022
    POD/TOD accounts goes directly to the beneficiary upon the account owner's death. If that considered a gift or inheritance to the recipient? If a state like NJ has an inheritance tax, is that transfer taxable to the recipient? I assume if it is
    considered a gift, it would not be taxable to the recipient?

    Separately, is the POD/TOD account part of the deceased's estate for unified gift/estate tax computation?

    TIA

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  • From Stuart O. Bronstein@21:1/5 to [email protected] on Tue May 24 14:38:40 2022
    <[email protected]> wrote:

    POD/TOD accounts goes directly to the beneficiary upon the account
    owner's death. If that considered a gift or inheritance to the
    recipient?

    Generally, yes.

    If a state like NJ has an inheritance tax, is that
    transfer taxable to the recipient?

    If it's an estate tax and the transfer is taxable, it's taxable to
    the estate. If it's an inheritance tax it will be taxable to the
    heir.

    I assume if it is considered a
    gift, it would not be taxable to the recipient?

    There is generally no income tax to the recipient, unless the gift
    comes from an IRA, 401(k) or other type of qualified plan.

    Separately, is the POD/TOD account part of the deceased's estate
    for unified gift/estate tax computation?

    Normally, yes.

    --
    Stu
    http://DownToEarthLawyer.com

    --
    << ------------------------------------------------------- >>
    << The foregoing was not intended or written to be used, >>
    << nor can it used, for the purpose of avoiding penalties >>
    << that may be imposed upon the taxpayer. >>
    << >>
    << The Charter and the Guidelines for submitting posts >>
    << to this newsgroup as well as our anti-spamming policy >>
    << are at www.asktax.org. >>
    << Copyright (2011) - All rights reserved. >>
    << ------------------------------------------------------- >>

    --- SoupGate-Win32 v1.05
    * Origin: fsxNet Usenet Gateway (21:1/5)
  • From ____@21:1/5 to Stuart O. Bronstein on Wed May 25 10:33:05 2022
    On Tuesday, May 24, 2022 at 2:43:14 PM UTC-4, Stuart O. Bronstein wrote:
    <[email protected]> wrote:

    POD/TOD accounts goes directly to the beneficiary upon the account
    owner's death. If that considered a gift or inheritance to the
    recipient?

    Generally, yes.

    It is not clear to me. Is the POD considered a gift OR an inheritance?


    If a state like NJ has an inheritance tax, is that
    transfer taxable to the recipient?

    If it's an estate tax and the transfer is taxable, it's taxable to
    the estate. If it's an inheritance tax it will be taxable to the
    heir.

    The decedent is in a state with estate tax; and the POD recipient is in a state with an inheritance tax (e.g. NY and NJ). The recipient is not a relative of the decedent. I assume since POD transfer occurs after a person died, then the transfer is an
    inheritance to a NJ recipient? Then the question is: does the NJ inheritance tax apply to an inheritance coming from outside of NJ?


    I assume if it is considered a
    gift, it would not be taxable to the recipient?

    There is generally no income tax to the recipient, unless the gift
    comes from an IRA, 401(k) or other type of qualified plan.

    Separately, is the POD/TOD account part of the deceased's estate
    for unified gift/estate tax computation?

    Normally, yes.

    --
    Stu
    http://DownToEarthLawyer.com

    --
    << ------------------------------------------------------- >>
    << The foregoing was not intended or written to be used, >>
    << nor can it used, for the purpose of avoiding penalties >>
    << that may be imposed upon the taxpayer. >>
    << >>
    << The Charter and the Guidelines for submitting posts >>
    << to this newsgroup as well as our anti-spamming policy >>
    << are at www.asktax.org. >>
    << Copyright (2011) - All rights reserved. >>
    << ------------------------------------------------------- >>

    --- SoupGate-Win32 v1.05
    * Origin: fsxNet Usenet Gateway (21:1/5)
  • From ira smilovitz@21:1/5 to [email protected] on Wed May 25 11:37:18 2022
    On Wednesday, May 25, 2022 at 10:33:22 AM UTC-4, [email protected] wrote:
    On Tuesday, May 24, 2022 at 2:43:14 PM UTC-4, Stuart O. Bronstein wrote:
    <[email protected]> wrote:

    POD/TOD accounts goes directly to the beneficiary upon the account owner's death. If that considered a gift or inheritance to the
    recipient?

    Generally, yes.
    It is not clear to me. Is the POD considered a gift OR an inheritance?
    If a state like NJ has an inheritance tax, is that
    transfer taxable to the recipient?

    If it's an estate tax and the transfer is taxable, it's taxable to
    the estate. If it's an inheritance tax it will be taxable to the
    heir.
    The decedent is in a state with estate tax; and the POD recipient is in a state with an inheritance tax (e.g. NY and NJ). The recipient is not a relative of the decedent. I assume since POD transfer occurs after a person died, then the transfer is an
    inheritance to a NJ recipient? Then the question is: does the NJ inheritance tax apply to an inheritance coming from outside of NJ?
    I assume if it is considered a
    gift, it would not be taxable to the recipient?

    There is generally no income tax to the recipient, unless the gift
    comes from an IRA, 401(k) or other type of qualified plan.

    Separately, is the POD/TOD account part of the deceased's estate
    for unified gift/estate tax computation?

    Normally, yes.

    --
    Stu
    http://DownToEarthLawyer.com

    --

    From the instructions for NJ Form IT-R:

    2. The transfer of intangible personal property such as stocks,
    bonds, corporate securities, bank deposits and mortgages
    owned by a nonresident decedent is not subject to the New
    Jersey Inheritance Tax.

    Ira Smilovitz, EA
    Leonia, NJ

    --
    << ------------------------------------------------------- >>
    << The foregoing was not intended or written to be used, >>
    << nor can it used, for the purpose of avoiding penalties >>
    << that may be imposed upon the taxpayer. >>
    << >>
    << The Charter and the Guidelines for submitting posts >>
    << to this newsgroup as well as our anti-spamming policy >>
    << are at www.asktax.org. >>
    << Copyright (2011) - All rights reserved. >>
    << ------------------------------------------------------- >>

    --- SoupGate-Win32 v1.05
    * Origin: fsxNet Usenet Gateway (21:1/5)
  • From Stuart O. Bronstein@21:1/5 to [email protected] on Wed May 25 12:42:47 2022
    ____ <[email protected]> wrote:
    POD/TOD accounts goes directly to the beneficiary upon the
    account owner's death. If that considered a gift or inheritance
    to the recipient?

    Generally, yes.

    It is not clear to me. Is the POD considered a gift OR an
    inheritance?

    If it's not paid until the death of the donor, it's an inheritance.

    --
    Stu
    http://DownToEarthLawyer.com

    --
    << ------------------------------------------------------- >>
    << The foregoing was not intended or written to be used, >>
    << nor can it used, for the purpose of avoiding penalties >>
    << that may be imposed upon the taxpayer. >>
    << >>
    << The Charter and the Guidelines for submitting posts >>
    << to this newsgroup as well as our anti-spamming policy >>
    << are at www.asktax.org. >>
    << Copyright (2011) - All rights reserved. >>
    << ------------------------------------------------------- >>

    --- SoupGate-Win32 v1.05
    * Origin: fsxNet Usenet Gateway (21:1/5)