My mother recently passed away and her trust left much to be desired. It was so generic it isn't going to help my brother and I avoid taxes. For example, her investments were titled to the trust which means we have to cash them out, have the "trust" pay taxes and then we split what is left. Her investments were around $400K. I am in the US and I'm in my 40's. She was 69. My dad is gone as well.
My mom's financial advisor hasn't been much help, my accountant hasn't either. Can someone help me figure out a way to try to avoid some of the tax implications? I am maxing out my 401k at work (first year I've been able to do that) and putting $5500 in an IRA. I will have my husband do the same (he's self employed so we will do a SEP and max out his IRA). Is there anything else I can do?
I have several questions and was hoping another Mustachian may have been through this. For example, when they cut the checks from her IRA and her annuity, will they typically withhold any taxes? And will I be responsible for additional taxes when I file my 2015 taxes?
All the research I've done makes me believe we will end up paying 40% taxes on the investments. Are there any other measures I can take to help reduce the amount of taxes I may owe? I understand I will owe, I don't mind paying what I owe but I'd love to reduce the amount the government takes by as much as I can.
Any input is greatly appreciated.