"vahania" <vahania63[at]yahoo.com> wrote:

- quote -

Insurance is generally not taxable. IRAs and annuities do
not qualify for lump sum tax treatment.

Barry Picker, CPA/PFS, CFP

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vahania wrote:

- quote -

Stop reading if the person who died was not born before Jan.
2, 1936.

There is special treatment of lump-sum distributions from
qualified employer plans (pension, profit sharing, stock
bonus, etc.) to a plan participant born before 1/2/36. This
is also available to a beneficiary if the plan participant
met the birthday requirement.

This is an election to calculate the tax by averaging it out
over 10 years. Note I did not say, spread the tax out over
10 years. You will pay all the tax at once. You may also be
eligible to treat some of the payment as capital gains. All
of this is explained in IRS Pub 575 starting on page 18. You
use Form 4972 to make the calculation. There is additional
information in the instructions for this form.
http://www.irs.gov/formspubs/index.html

--
Alan
http://taxtopics.net

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vahania63[at]yahoo.com (vahania) writes:

- quote -

They don't. See Publication 575.

Phil Marti
Topeka, KS

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I inherited some IRA, insurance and annuities accounts that
I elected to receive as one time payment. I read that there
are special provisions for lump sum payment from 'qualified'
accounts. Could you please tell me which accounts are
qualified and if any of the accounts listed above fall into
this category.

Thanks in advance,
Val

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