[WSBAPT] IRA question

[Philip N. Jones]

I will leave the community property question to others to answer, but I suggest you start by asking for a copy of the default clause under the custodial agreement to make sure who the default beneficiary is.  Also keep in mind that the account will not necessarily pay out to the estate.  The custodian might allow the entire account to be assigned by the estate to an inherited IRA without making any withdrawals.  If you do have the estate take a withdrawal, be careful to make sure that the IRD (income in respect of a decedent) passes out to the spouse in the same tax year, in order to avoid the high fiduciary income tax rates of the estate.  $20K is not a large sum, but as long as you have the opportunity to do it right, you might as well do it.
Phil Jones

Philip N. Jones
Duffy Kekel LLP
900 S.W. Fifth Ave. Suite 2500
Portland, OR 97204
pjones at duffykekel.com<mailto:pjones at duffykekel.com>
(503) 226-1371 - office
(503) 853-1482 - cell
(503) 226-3574 - fax

From: wsbapt-bounces at lists.wsbarppt.com <wsbapt-bounces at lists.wsbarppt.com> On Behalf Of Shannon Jones
Sent: Wednesday, January 19, 2022 10:18 AM
To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com>
Subject: [WSBAPT] IRA question

Listmates, A client's spouse has died leaving a small ($20k) IRA which has no beneficiary listed. The account administrator has indicated they will pay 100% of the IRA to the "estate"  or that my client can claim ½ directly as community property and the other ½ will pay out to the estate. The surviving spouse is the only heir under the Will, so will receive the entire IRA under either scenario but wants to transfer this to an inherited IRA and further defer tax if possible. Does that mean taking ½ as surviving spouse under a community property claim rather than letting the entire IRA pay out to estate?

[cid:image002.png at 01D80D20.B3965CC0]
Shannon R. Jones | Attorney
Campbell Barnett PLLC
P: 253.848.3513| F: 253.845.4941
317 South Meridian
Puyallup, WA 98371
shannonj at campbellbarnettlaw.com<mailto:shannonj at campbellbarnettlaw.com>
campbellbarnettlaw.com<https://campbellbarnettlaw.com/>

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