Now is the time to see a financial planner and a lawyer specializing in
estate law. If the 403 plan allows partial rollovers, taking the money and
moving it into an IRA may make sense.

However the description of the estate makes it seem that doing it yourself
could be very expensive tax and probate wise if you miss a step. Taxes could
be mitigated using trusts, but it again depends often of what state you die
in.

"Robert Kim" <roberth[at]purdue.edu> wrote in message
news:Pine.SOL.4.51.0312231709560.15443[at]herald.cc.purdue.edu...
- quote -

- quote -

In the scenario described, no!

Hi, all. I have a question regarding retirement money and distributing to
kids before death to avoid/minimize estate and income taxes. The person
who wishes to distribute this income is 69-1/2 years old, is still
working, and is presently in the 30% federal income tax bracket.

His retirement is in a 401-b or c tax-deferred account that returns about
6% interest per year. His account is in the several million $ range so he
has no worries about running out of money before "kicking the bucket" even
after distributing maximum allowable amounts (whatever this amount may be)
to his children.

As of this year, I think the IRS allows a person to give up to $11,000 per
year per child without inheritance or income taxes. But for this person
to withdraw portions of his retirement money from his retirement account
to give to his kids, he has to pay income taxes at the 30% federal tax
rate.

Is there a way to eliminate/minimize the amount of ANY taxes (income,
inheritance, etc.) to pass on some of this retirement money to his
children?

Bob