CA question: Estate >> Trust process

[merlin00]

My father died with a trust but without it listed as beneficiary on his IRA. It just finished the probate process and the CA court ordered the estate funds to be transferred to the Trust, as his will directed, and the estate terminated. Does the Estate IRA get liquidated and distributed into an Estate savings account first, meaning all tax liability falls on the Estate, before the funds can be transferred into the Trust? I have been told 2 different things.

Going to the estate first means it has to surrender HALF the funds to federal and state taxes. Transferring it into a Trust IRA instead would mean the trust beneficiaries could receive look-through tax liability. But I'm starting to think this route might not be possible, at least not in CA! Please tell me there's a way around this 50% tax situation... Thank you.

[tagteam]

You should consult with the attorney who handled the estate during the probate process.

You also might want to consult a local tax professional (in CA).

See https://taxexperts.naea.org/expertdirectory