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Does my Wife have to turn in the money she got from her Mother's life insurance to the estate funds to be evenly distributed to remaining heirs

Thanks for all the help but got it all taken care of

JoeTaxpayer
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Robert
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1 Answers1

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In the United States, the answer is no. Life insurance proceeds pass by operation of law. In fact, it would be a taxable event to pass it as a gift to the estate; your wife would have to pay the tax. The giver pays the tax. So you need a local attorney if there is any serious consideration of doing this.

Now there is another issue. If the overall estate is subject to estate tax, then the estate will have to pay any federal estate tax on the life insurance proceeds.

Dave Harris
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