Have a Tax Question? Ask a Tax Expert
Hi Paul, I am sorry for your loss. My name is Mark. I will be happy to help you with your questions. Please give me a moment to prepare your response.
Do you know what type of pension your wife had? How old was she when she passed away?
Let me address your question regarding the life insurance. In most cases life insurance proceeds would not be taxable.
Unfortunately, you would not be able to transfer the tax liability of the pension. At $600 a month, the amount fall below the requirement ($14,000 annual exemption) for filing a gift tax return.
Did you agree for the children to become beneficiaries of the pension account?
I figured that you did but wanted to verify to be sure. Unfortunately the pension would be taxable to the children. The pension could be directed to withhold at their marginal rates with the remainder going to your account.
Unfortunately there would be no way to shift the income to you.