[WSBAPT] Beneficiary of IRA responsible for expenses/estate tax

[John J. Sullivan]

I agree with the court. Under RCW 6.15.020 a decedent's IRA was exempt when he was alive, so it, unlike certain other nonprobate assets, cannot be forced to contribute to the expenses of or claims against the estate. 

There is one exception I am aware of: federal law overrides the exemption for past income and employment taxes owed to the IRS. But even there, the Manual indicates the IRS only goes after IRA assets in especially egregious circumstances while the participant is alive. 

I'm not sure this would apply to an IRA previously inherited by the decedent, which is not exempt at least in bankruptcy. 

I suppose too the federal estate tax lien would attach if applicable. 

John Sullivan

Sent from my iPhone

> On Apr 14, 2017, at 4:26 PM, Jeff Davis <jeff at bellanddavispllc.com> wrote:
> 
> For what it is worth, attached is a probate court’s memorandum opinion denying my motion to stop the distribution of an inherited IRA going to decedent’s children because there were insufficient estate assets to pay creditors.
>  
> Jeff Davis
>  
> From: wsbapt-bounces at lists.wsbarppt.com [mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of Glenn Price
> Sent: Friday, April 14, 2017 4:07 PM
> To: WSBA Probate & Trust Listserv (wsbapt at lists.wsbarppt.com) <wsbapt at lists.wsbarppt.com>
> Subject: [WSBAPT] Beneficiary of IRA responsible for expenses/estate tax
>  
>  
>  
>  
> Is a non-spouse beneficiary of an IRA liable for payment of expenses or estate tax of the decedent’s estate?
>  
>  
> Glenn D. Price, J.D.
> Price & Farrington, PLLC
> Attorneys and Counselors at Law  
> Parkwood Office Center
> 2370 130th Avenue N.E., Suite 103
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> Phone: 425.451.3583  Fax: 425.522.4818
> Email: glenn at pricefarrington.com
> Home page:   www.pricefarrington.com
> Estate, Tax, Retirement and Asset Protection Planning
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> <0029. Memorandum Opinion & Order.12.14.15.pdf>
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