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Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 10911
Experience:  Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
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My brother was put as a primary on my Grandmothers bank account.

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My brother was put as a primary on my Grandmother's bank account. This was done recently as a precaution in chase she get's sick, etc. I wanted to know if she passes how does this effect my brother tax wise? He does her banking for her as necessary online.

The funds are all my Grandmother at this point. He is the primary account holder now. Does he have tax consequences now, when she passes, neither or both?

Lane :

Hi,

Lane :

If he is listed as the OWNER of the account with the bank, then the CURRENT implications will be that he will get a 1099-int at year end and will need to report the interest on his tax return

Customer:

Ok that makes sense.

Lane :

BUt if he is already the qowner on the account, then when your grandmother passes, that will not be a taxable event

Lane :

The only possible CURRENT issue would be whan the ownership passed from your grandmother to him, it wold technically be a gift

Lane :

but the lifetime exclusion on gift taxes is $5,120,000, so unless she has gifted thos kinds of amounts there is no issue there either

Lane :

Make sense?

Customer:

Yes for sure. Does he need to file a gift though as the receiver?

Lane :

Actually gift and estate taxes (estate transfers are really the FINAL gift) are borne by the giver ...

Lane :

gifts are excluded from income for the receiver

Customer:

Okay. Seems like he is okay then for the most part..

Lane :

If she is nowhere near the 5 million dollar limit then there's really nothing that needs to be done ... although IRS likes for any transfers above 14,000 per person per year to file a gift tax form so that they can track it against that $5,250,000 lifetime exclusion

Customer:

understood. Thanks for the info..

Lane :

Yes, HE has to do nothing at all ... again, if the gift is over 14,000 there's a form Form 709 that SHE can file ... but again if she's nowhere near that 5 million limit then there's really nothing to track

Lane :

You're welcome

Lane :

If this HAS helped, I would appreciate a feedback rating of 3 (OK) or better … That's the only way they will pay us here.


HOWEVER, if you need more on this, PLEASE COME BACK here, so you won't be charged for another question.

Customer:

Okay will do. Thanks

Lane and other Tax Specialists are ready to help you

Thanks so much for the rating Duane.

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And if you ave other questions on THIS, come back here.

Thanks again,
Lane