- 6 - checks each in the amount of $150,000 to Farmer’s New World Life Insurance Company. Each $150,000 check was issued for an individual retirement account (IRA) in the name of each of decedent’s three children. On decedent’s 2000 Form 1040, U.S. Individual Income Tax Return, the personal representative reported the lump-sum distribution from decedent’s TIAA-CREF accumulated annuity fund as reported on the Form 1099-R. However, the personal representative erroneously reported the taxable amount of the distribution to be $149,949.2 On decedent’s Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return, the personal representative included the remaining balance of decedent’s TIAA- CREF accumulated annuity funds in decedent’s gross estate.3 On Form 1041, U.S. Income Tax Return for Estates and Trusts, decedent’s estate did not report any amount with respect to 2 This amount reflects the taxable amount of the distribution reported on the Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc., less the $450,000 received by decedent’s three children. The personal representative erroneously determined that the $450,000 received by decedent’s three children for the three IRAs was a tax-free “roll-over” under sec. 403(b)(8). 3 After decedent’s death, TIAA-CREF computed the 25 percent death benefits distribution to the charitable beneficiaries based upon the balance in the annuity fund after the $600,000 distribution to decedent.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 Next
Last modified: May 25, 2011