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If there's a clause in a Will that reads, "Anything under this Will to the contrary notwithstanding, the Executor is Prohibited

San Francisco, CA |

..from using any distributions from a retirement plan otherwise excluded from federal estate tax under internal revenue code section 2039(b) to pay inheritance, estate, or other death taxes or interst or penalties, or to pay debts or administration expenses of my estate or for the benefit of my estate. If my estate includes the value of property to whichsection 2044 of the internal revenue code(relating to property to which I had a qualifying income interest for life) applies, the executor shall not recover the amount that my estate is entitled to to recover under section 2077A of the Internal revenue codefrom the person or persons recieving that property. WHAT IN THE WORLD DOES THIS MEAN? PLEASE HELP....Thank you~

Attorney Answers 2

Posted

The short answer is that it's a clause designed to save taxes to the greatest extent possible.... you could call it a "heads up" to the executor that s/he needs to make sure s/he uses a competent tax professional who understands both estate taxes and income taxes to make sure a "rookie" mistake doesn't accidentally trigger a boatload of taxes.

The response given is not intended to create, nor does it create an ongoing duty to respond to questions. The response does not form an attorney-client relationship, nor is it intended to be anything other than the educated opinion of the author. It should not be relied upon as legal advice. The response given is based upon the limited facts provided by the person asking the question. To the extent additional or different facts exist, the response might possibly change. Attorney is licensed to practice law only in the State of California. Responses are based solely on California law unless stated otherwise.

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James P. Frederick

James P. Frederick

Posted

Very good summation, Janet!

Posted

Is this even a large estate? Chances are this provision is meaningless. These provisions are common and placed into estate planning documents, and, in many situations, for people who have no need for them. Speak with a trusts & estates attorney in your area.

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