What is the name of your state?NJ
My Aunt left me a POD CD (60K) in the local bank. She passed several months ago and her will has been probated. Am I exposed to an inheritance tax with the state or federal GOV.? In her will she was to pay all taxes on her estate before distribution. Would a POD distribution be considered part of her estate? Thank you, Ed
You're welcome. While you are at it, you might want to ask them if it is considered income (if your state has income tax). You might also want to ask a tax pro if this is considered income for federal purposes.
I don't even do my own (simple!?) income taxes so I don't know.
Anyone know who pays inheritance tax on POD accounts in Indiana? If not specified in the will, does the estate pay it or the person listed as POD on the account pay it? There seems to be confusion about this and I find that no one really knows for sure....including attorneys. This type of account is exempt from probate, so it would seem that taxes should be paid separate from the estate since the reason it is set up as such is to avoid probate and give almost immediate access to funds. If it is taxed to the estate, then that would mean it is tax free to the person on the POD. That could be considered a loophole then to avoid paying taxes as well if the estate pays the tax. Seems that then it could be also considered income to the POD listed person and be taxed again? POD seems to be a very gray area. Can anyone shed some light on this?
Better yet, post it on the TAX LAW Message Board. Whether there are any federal taxes depends on how much it's worth--no taxes if less than $2 million. Whether there are state taxes you will have to look into.
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