QUESTION
do i need to pay mothers debt if i cash in her 401k account after her death? how do i know if she has debt? do i pay a penatly for cash in?
Asked on Jan 13th, 2013 on Trusts and Estates - New York
More details to this question:
mother died 4 years ago. my brother and i got nothing, were forced to make no decisions on who gets what, funeral decision medical decision ect. i was 19 at the time brother 21. can i sue mothers boyfriend for that? also 4 years later i got an email from mothers old employer... there was a 401k left for the estate. is that just me or my brother too? the boss said that if i cash in i have to pay 20 percent penalty and 30 percent taxes is that true? this is in ny state.
1 ANSWER
1 Award
The answer is if you cash it in, you do need to pay taxes on it. However, you can roll it over into your own IRA, and not pay taxes. But, if the beneficiary is the estate, you are going to need to form one. You should consider using a lawyer. There may even be other assets to find. It is cheaper if your brother and you cooperate.
Answered on Jan 13th, 2013 at 3:50 PM