401 K and taxes?

Question

My mom recently passed and I am getting her 401 K the problem is that between the deferal government and Arkansas they get about 40%. Is there a better way to do this so I will not loose so much money?

Answer 1

Contact this guy ... he knows what he is doing....

http://www.drewmiles.com/

Michael

Answer 2

Soory about your lost....

Answer 3

find a good tax consultant in your area and ask. I do not know your situation well enough to advise you correctly.

Answer 4

Well, you can (probably, depending on the exact details of the inheritance, whether you get the 401 K as beneficiary of the 401 K or of the estate, etc.)  roll it over to an inherited IRA.  Then you can distribute (and pay taxes on it) over your estimated life.

Contrary to one of the other posters, you cannot really contribute THAT money to another IRA.  However, you may be able to contribute money (up to the amount of the lesser of your earned income and a statutory limit around $4,000), and money is money.  You don't have to tell the bank or the IRS where you got the money.

Answer 5

Absolutely!  You can roll it over to an inherited IRA.  You will have to take distributions each year but the amount will depend upon your age.  If you are working and don't need the money, you can contribute it (up to the annual limits) to your own IRA.

This is a far better way to go as there will be no penalty and the tax will be spread over many years (and possibly offset if you are able to contribute some of it to your IRA).

Needless to say, a consulation with a tax professional could be very valuable and shouldn't cost a lot.