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<p class="MsoNormal"><span style="color:#1F497D">Marcus--Thanks, I have never heard of this--I'm definitely glad to hear it.<o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#1F497D"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="color:#1F497D">In this case, though, the heirs are okay with getting the cash; we're just trying to minimize the tax hit by selectively allocating the income pass-through to low-income beneficiaries. Any thoughts on whether
that's allowed?<o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#1F497D"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;color:#1F497D">Sincerely,<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;color:#1F497D"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;color:#1F497D">Eric<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;color:#1F497D"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;color:#1F497D">Eric C. Nelsen<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;color:#1F497D">SAYRE LAW OFFICES, PLLC<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;color:#1F497D">1320 University St<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;color:#1F497D">Seattle WA 98101-2837<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;color:#1F497D">phone 206-625-0092<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;color:#1F497D">fax 206-625-9040<o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#1F497D"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="color:#1F497D"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="color:#1F497D"><o:p> </o:p></span></p>
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<p class="MsoNormal"><b><span style="font-size:10.0pt;font-family:"Tahoma","sans-serif"">From:</span></b><span style="font-size:10.0pt;font-family:"Tahoma","sans-serif""> wsbapt-bounces@lists.wsbarppt.com [mailto:wsbapt-bounces@lists.wsbarppt.com]
<b>On Behalf Of </b>Marcus Fry<br>
<b>Sent:</b> Thursday, April 02, 2015 4:28 PM<br>
<b>To:</b> 'WSBA Probate & Trust Listserv'<br>
<b>Subject:</b> Re: [WSBAPT] Non pro rata allocation of taxable income to beneficiaries<o:p></o:p></span></p>
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<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><a name="_GoBack"></a><span style="color:#1F497D">Eric:<o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#1F497D">I disagree about “no rollover options.” First, it’s technically not a rollover, as rollovers are only for spouses. However, many financial institutions permit the PR to instruct the establishment of inherited
IRAs in each beneficiary’s name. Natalie Choate’s website list some good companies.</span>
<span style="color:#1F497D"><a href="http://www.ataxplan.com/bulletinboard/ira_providers.cfm">http://www.ataxplan.com/bulletinboard/ira_providers.cfm</a>
<o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#1F497D"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="color:#1F497D">I suggest moving the IRA to another institution as suggested by Choate if the one you are at will not cooperate.<o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#1F497D"><o:p> </o:p></span></p>
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<p class="MsoNormal" style="text-align:justify"><span style="font-size:10.0pt;font-family:"Courier New";color:#1F497D">Marcus J. Fry<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:10.0pt;font-family:"Courier New";color:#1F497D">Lyon, Weigand & Gustafson, P.S.</span><span style="font-size:12.0pt;font-family:"Times New Roman","serif";color:#1F497D">
<br>
</span><span style="font-size:10.0pt;font-family:"Courier New";color:#1F497D">Adoption Attorney*<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:10.0pt;font-family:"Courier New";color:#1F497D">P.O. Box 1689</span><span style="font-size:12.0pt;font-family:"Times New Roman","serif";color:#1F497D">
<br>
</span><span style="font-size:10.0pt;font-family:"Courier New";color:#1F497D">Yakima, Washington 98907</span><span style="font-size:12.0pt;font-family:"Times New Roman","serif";color:#1F497D">
<br>
</span><span style="font-size:10.0pt;font-family:"Courier New";color:#1F497D">Telephone: (509) 248-7220</span><span style="font-size:12.0pt;font-family:"Times New Roman","serif";color:#1F497D">
<br>
</span><span style="font-size:10.0pt;font-family:"Courier New";color:#1F497D">Facsimile: (509) 575-1883</span><span style="font-size:12.0pt;font-family:"Times New Roman","serif";color:#1F497D">
<o:p></o:p></span></p>
<p class="MsoNormal" style="text-align:justify"><b><u><span style="font-size:9.0pt;font-family:"Arial","sans-serif";color:#1F497D"><o:p><span style="text-decoration:none"> </span></o:p></span></u></b></p>
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<p class="MsoNormal" style="text-align:justify"><span style="font-size:9.0pt;font-family:"Arial","sans-serif";color:#1F497D"> *Adoption Attorney reflects election as a Fellow of the American Academy of Adoption Attorneys, an invitation based organization of
300+ attorneys nationwide, under its criteria of experience, ethics and peer recommendation. Washington's Supreme Court has not yet developed or recognized a credentialing process for specialties, and certification/fellowship is not required to practice law
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<p class="MsoNormal"><span style="color:#1F497D"><o:p> </o:p></span></p>
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<p class="MsoNormal"><b><span style="font-size:10.0pt;font-family:"Tahoma","sans-serif"">From:</span></b><span style="font-size:10.0pt;font-family:"Tahoma","sans-serif"">
<a href="mailto:wsbapt-bounces@lists.wsbarppt.com">wsbapt-bounces@lists.wsbarppt.com</a> [<a href="mailto:wsbapt-bounces@lists.wsbarppt.com">mailto:wsbapt-bounces@lists.wsbarppt.com</a>]
<b>On Behalf Of </b>Eric Nelsen<br>
<b>Sent:</b> Thursday, April 02, 2015 3:57 PM<br>
<b>To:</b> WSBA Probate & Trust listserve (<a href="mailto:wsbapt@lists.wsbarppt.com">wsbapt@lists.wsbarppt.com</a>)<br>
<b>Subject:</b> [WSBAPT] Non pro rata allocation of taxable income to beneficiaries<o:p></o:p></span></p>
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<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Estate has four equal beneficiaries. Decedent had an IRA that paid directly to Estate, so no rollover options.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">One of the beneficiaries is in a very low tax bracket, and all four beneficiaries agree that they'd like all the tax liability for the IRA allocated to that one beneficiary. (There's enough other cash in the estate to allow complete distribution
of the IRA to one and make compensatory distributions to the other three of untaxed inheritance dollars.)<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Is that allowed? So the Estate would do a tax return and issue K-1s, allocating all income liability to one out of the four beneficiaries, and none to the other three?<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Any idea where I would look for the governing rule? IRS Code or Regs I would guess, but not sure where...<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><span style="font-size:12.0pt">Sincerely,<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt">Eric C. Nelsen<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt">SAYRE LAW OFFICES, PLLC<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt">1320 University St<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt">Seattle WA 98101-2837<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt">phone 206-625-0092<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt">fax 206-625-9040<o:p></o:p></span></p>
<p class="MsoNormal"><o:p> </o:p></p>
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