Life insurance, retirement benefits

[sue1anne]

What is the name of your state (only U.S. law)? Oregon

Beneficiary lives in Oregon, Probate is in Indiana

How do life insurance proceeds affect the estate? The person who died retired from military, then retired from civil service. There are five heirs, four get 10% of the estate and the last (also executor) gets the remainder.

Life insurance beneficiary will get money from both policies and report that to the executor. What happens next and does it affect how the estate is divided and the amount left to heirs, or the amount of the estate's value?

What taxes are due on the life insurance benefits?

 

[justalayman]

Life insurance beneficiary will get money from both policies and report that to the executor.

there is no duty for the bene to report anything concerning the life insurance to the executor. Unless the bene is the estate, the money passes outside of probate and is of no concern to the estate or it's administrators. The money simply belongs to the named beneficiary (ies).

 

[sue1anne]

Thank you very much. I appreciate your quick reply. She is telling us we need to report this benefit to the estate, which we will not do now.

 

[ShyCat]

Actually, the executor would need to know the benefit amounts to calculate Federal (and possibly state) estate taxes, if necessary. Life insurance benefits are included in the taxable estate if the deceased was the owner of the policy.