Death and Taxes

[Aragorn243]

I learned some things in the past week the hard way. My daughter's father in law passed away suddenly and unexpectedly on Christmas Eve at age 58. His health insurance company cancelled all coverage for his surviving family members on December 24th, even though the policy was paid through the end of the month. The US Air Force seized his December retirement payment so they can reissue it for 24 days. Now I don't know what retirement settlement he got from the military but his wife is not eligible for it as a dependent. Suspicion is it was some sort of early payment plan. He had 20 years.

Who knows what else is going to come up but these are two items that I for one just took for granted.

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[HOOKED ON HISTORY]

It would cost far in excess of the seven days retirement pay to regenerate the payment even if those processing it were payed minimum wage which I am quite certain the are not. How we treat our veterans is the canary in the coal mine dead and cold at the bottom of the cage. Hold on folks I think we are soon to encounter some turbulance.

[Paul S.]

My limited exposure to the workings of Department of Veterans Affairs in Australia and the US tells me the bloke's widow should immediately contact the service representative for whatever veterans organization her husband belonged. She should also contact a social worker with decedent affairs at the local veterans' hospital. Otherwise, she's likely to be trampled by Air Force bureaucracy.

[Aragorn243]

I don't think he belonged to any veterans organizations. Not sure. I didn't know him as well as I would have liked. Figured there would be plenty of time to get to know him. We got together at family gatherings, etc. He was so full of life, happy, good natured. This was really hard. And now his wife is getting screwed by the system. I don't know as much as I should about all this but figured she would be entitled to his benefits including the VA but apparently, he took some sort of early payment that removed spousal benefits. I didn't even know such a thing existed. He invested the money I guess so she isn't destitute but this still sucks. He did just about all the financials, was still paying for his younger son's car insurance, health insurance and that's now cut off.

[WarPig1976]

The wife should be clear but if he left anything to the kids they have 90 days to pay the inheritance tax on the value. Just went through this settling my mothers estate. The best thing parents can do is sell any property to their heirs for $1 before it's too late. This will save your heirs thousands in "inheritance" taxes. It's disgusting, the hands that reach into your pockets and those of your heirs after death if you didn't plan years in advance.

[Seaspriter]

The best thing parents can do is sell any property to their heirs for $1 before it's too late. This will save your heirs thousands in "inheritance" taxes. It's disgusting, the hands that reach into your pockets and those of your heirs after death if you didn't plan years in advance.

So very true. The other option is to put everything you own into a trust that survives the death. Only problem arises when there is an unethical/greedy member of the family -- then it's worse than the government as the lawyers brutalize the survivors (I know from hideous experience).

[Aragorn243]

They are taxing the life insurance also. Forgot to post that. It's considered income. That's another thing I didn't realize they did. Government thieves. As for selling things to the kids, who does that at 58?

[AFJon]

Sorry for your loss. Was your Father in law paying into the SBP for his wife? If so sound like there may be a disconnect. This may require a couple of phone calls or a trip to the local base if that is convenient.

Air Force Retirees Services - SBP

[WarPig1976]

It just needs to be sold before the second spouse passes.

[Aragorn243]

Was your Father in law paying into the SBP for his wife?

My daughter's father in law. That is an excellent question. I forwarded the link to them. Thank you very much. I don't think they know exactly what he was doing with finances yet. They are meeting with the lawyer tomorrow. He had an accountant so there is at least someone who knows much of what was going on.