Legal Question in Wills and Trusts in New York
ira distribution
i recieved ira distribution-i am not a trustie. am i leagally bound to give the checks to the trustie to pay credits card bill and then to split the remaining money amoung the four other siblings.there are other accounts and money to be split among all. thank you
1 Answer from Attorneys
Re: ira distribution
You have not provided sufficient information to give a proper answer. Were you the designated beneficiary of the account? Were other people besides you named as beneficiary on the account? Are there other assets in the estate that can be used to pay these bills? If so, are they sufficient to pay them all? You will have income tax consequences by receiving the IRA account. If there is a legal obligation to use the proceeds to pay debts of the decedent (this depends upon the State law where the decedent died, which may prevent a creditor from asserting a claim against the account), how will you be reimbursed for the income taxes due? Besides these questions, you should contact a creditors rights attorney in the State where the decedent died, to see if you have any obligations to use the proceeds to pay the debts. As to splitting the proceeds among siblings, if you were the sole designated beneficiary, this is a moral, not a legal issue, between you and the other siblings, and goes to the question of why you were designated the sole beneficiary. The income tax issue applies here also.