Please help this old man. Can someone advise me on a tax situation?

My mother’s estate has a $637,000 annuity. My sister and I are the beneficiary’s. About 1/3rd of that amount is from interest gained. We are planning on taking the money in yearly payments, rather than pay a much higher rate for taking it all right now. She was receiving about $3800 a month in retirement and social security. The care facility cost $5800 a month. She got about $1000 back in prior years. There shouldn’t be any taxes owed by my mothers estate, on the Principal, should there? How will taxes work?

11 Answers

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  • 4 weeks ago
    Best Answer

    With an annuity of that size, don't mess this up trying to figure it out yourselves...hire a pro.

    • ricky
      Lv 7
      3 weeks agoReport

      First pro didn’t know. 2nd pro says it has to be paid out over a 5 year period. Basically 33 percent is interest earned, so if I get 100,000, I receive 67k tax free, and pay taxes on the other 33k as income.

  • Anonymous
    3 weeks ago

    Can conservatives PLEASE stop WORSHIPING David Duke, Charles Manson, and Ted Bundy?

    Can they PLEASE stop hating the middle and lower classes?

    And can they PLEASE stop making OJ Simpson, Charles Manson, and Saddam Hussein look like ANGELS?

  • DIEGO.
    Lv 7
    4 weeks ago

    this is a good question!

    • ricky
      Lv 7
      3 weeks agoReport

      See my comment under best answer

  • 4 weeks ago

    There aren't any federal taxes on estates anymore. State taxes - yes. Depends on the state.

    • ricky
      Lv 7
      3 weeks agoReport

      The tax isn’t an inheritance tax. The tax is on the annuity that gained interest. See my comment under “best answer”.

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  • Judy
    Lv 7
    4 weeks ago

    For federal, no, the estate will not be taxed. A few states have and estate of an inheritance tax. Unless she lived in one eof those states, no state tax either. No income tax will be due on the part of the annuity that was her cost, but will on interest.

    • ricky
      Lv 7
      3 weeks agoReport

      See my comment under “best answer”.

  • Anonymous
    4 weeks ago

    https://cbcsettlementfunding.com/annuities/types/i...

    This may help a little bit. The principal is post-tax money and will not be taxed again. The money over and above that *is* taxable.

    • ricky
      Lv 7
      3 weeks agoReport

      I’m sorry I awarded best answer before reading your reply. You are correct friend. See my comment under best answer.

  • Pearl
    Lv 7
    4 weeks ago

    you need to ask a tax place this question

    • ricky
      Lv 7
      3 weeks agoReport

      I did Pearl, see my comment under best answer, Ricky.

  • Stoo
    Lv 7
    4 weeks ago

    You have enough money from the annuity to hire a professional to get advice.

    • Casey Y
      Lv 7
      4 weeks agoReport

      Why? You are paying them for their advice...just don't buy if they try to sell you a new annuity.

  • Anonymous
    4 weeks ago

    Hire a tax consultant

  • Jim
    Lv 7
    4 weeks ago

    Hire a tax consultant.

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