Inherited Retirement Accounts: 5 Things You Need to Know

Matthew T. McClintock, J.D. has authored an article, Inherited Retirement Accounts: 5 Things You Need to Know, on Wealth Counsel’s website. The article begins as follows:

Almost everyone has some kind of retirement account—whether a 401(k), IRA or pension—so proper estate planning for these funds is essential. From tax treatment to beneficiary designations, Matthew T. McClintock, J.D., VP of Education with WealthCounsel, answers your questions.

Will my beneficiaries owe taxes on the retirement accounts I pass down to them?

Probably. Assets like life insurance, real estate, vehicles and non-retirement investment accounts are not counted as income when they’re inherited. Retirement accounts, however? They’re “income in respect of a decedent,” and any amounts withdrawn from non-Roth accounts are subject to income tax at the beneficiary’s ordinary income tax rate.

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Posted by Lewis J. Saret, Co-General Editor, Wealth Strategies Journal.