I am NOT advocating illegal behavior. What would be the penalty/drawback in this situation.
Electronic
Wife dies, Treasury has NOT been notified. A series of electronic Ibonds are held with two separate registrations-
1)Joint owners-husband and wife
2) Joint owners-wife and daughter.
Surviving husband has access to wife's TD account. Both parties have TD accounts
a1) He redeems the bonds to a joint account with both husband and wife at a local bank. That account will remain open, wife's name will be removed. Interest will be reported to deceased spouse on their joint return OR
a2) He redeems the bonds to his wife's bank account which is POD him.
Scenario for bonds held With daughter
1) he redeems bonds into wife's individual account and passes proceeds to daughter (interest income would go to wife's estate/2023 tax return)
2) daughter is advised to open own TD account. Then what?
Presumably totally illegal although no illegal intent-- changing the registration on wife/daughter to wife/husband, husband redeems and gives money to daughter
The intent of this is NOT illegal behavior or tax avoidance but avoidance of TD bureaucracy.
Paper bonds-
Joint owners-husband/wife
1)Husband redeems bonds at local bank that are held jointly OR
2) Husband sends jointly held bonds to TD (death cert necessary?) with a request to reissue in his name only
Joint owners-wife/daughter
1)husband gives bonds to daughter to complete complete paperwork and mail to CD either for cash redemption or to be put into new account for daughter
Electronic
Wife dies, Treasury has NOT been notified. A series of electronic Ibonds are held with two separate registrations-
1)Joint owners-husband and wife
2) Joint owners-wife and daughter.
Surviving husband has access to wife's TD account. Both parties have TD accounts
a1) He redeems the bonds to a joint account with both husband and wife at a local bank. That account will remain open, wife's name will be removed. Interest will be reported to deceased spouse on their joint return OR
a2) He redeems the bonds to his wife's bank account which is POD him.
Scenario for bonds held With daughter
1) he redeems bonds into wife's individual account and passes proceeds to daughter (interest income would go to wife's estate/2023 tax return)
2) daughter is advised to open own TD account. Then what?
Presumably totally illegal although no illegal intent-- changing the registration on wife/daughter to wife/husband, husband redeems and gives money to daughter
The intent of this is NOT illegal behavior or tax avoidance but avoidance of TD bureaucracy.
Paper bonds-
Joint owners-husband/wife
1)Husband redeems bonds at local bank that are held jointly OR
2) Husband sends jointly held bonds to TD (death cert necessary?) with a request to reissue in his name only
Joint owners-wife/daughter
1)husband gives bonds to daughter to complete complete paperwork and mail to CD either for cash redemption or to be put into new account for daughter
Statistics: Posted by anhedonia — Sun Feb 25, 2024 7:09 pm