Legal Question in Wills and Trusts in New Jersey
my mother died and named me beneficiary 100k from a 401k of which i have to pay taxes. i am wondering, i know the execurtor gets 5% of the estate. would that 100,000 count as part of the estate even though it didn't go through the executor? And that it is a taxable asset on it's own?
thanks
2 Answers from Attorneys
Regardless of the tax considerations, as a general rule, non-probate assets [i.e. assets that pass outside the Will such as Life Insurance, 401k's and IRA's] are not subject to executor's commissions.
To follow up on what Jonathan said, he is correct that as a general rule, non-probate assets are not subject to an executor's commission.
However, the 401(k) is includible in the taxable estate, and you may have to pay an estate tax on that depending upon the size of the overall taxable estate and the tax allocation clause in the Will. In New Jersey, the estate tax threshold is $675,000. If the net estate is above that, it will be subject to an estate tax.
Kevin A. Pollock, J.D., LL.M.
www.PollockAtLaw.com
P: (609) 818-1555
Licensed to practice law in Florida, New Jersey, New York and Pennsylvania.
Also, visit my blog at: http://WillsTrustsEstates.blogspot.com/
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