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Do I have to wait for my sister to claim retirement accounts?
Question:
My father passed away last year and left two retirement accounts to my sister and me. There wasn’t much else left by the time he died, and we’ve pretty much divided up everything else. My sister is the executor, but she hasn’t gotten the retirement account money for us. Do I have to wait for her to send in whatever forms are required to get my share of the money?
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No, you don’t need to wait for your sister to act—and you shouldn’t. If your dad named you and your sister as beneficiaries, then the account funds pass outside of his will, and the executor isn’t in charge of them. So first of all, find out how your dad left the accounts—one to each of you, or do you share both? There are certain decisions you need to make, and actions you need to take, to make sure you don’t suffer negative tax consequences. For example, if you and your sister are joint beneficiaries, you may want to split the accounts but keep them as tax-deferred “inherited IRAs.” And depending on how old your father was when he died, you may need to take a certain amount of money out of the accounts each year (“required minimum distributions”) or face financial penalties. Promptly talk to someone at the financial institution that holds the accounts.
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