Inherited IRA in California & Community Property
We live in California and I inherited an IRA from my mom who was also a California resident. Her lawyer told me the inherited IRA is not considered community property. The bank says my husband needs to sign a waiver if I name our adult children as my beneficiaries. I don’t feel like I need to ask him to sign anything. The IRS website says inheritance is separate property. Do I need to have my husband sign the waiver my bank is insisting on?
Permalink Submitted by Alan - IRA critic on Wed, 2016-07-06 19:44
There is no reason for your spouse to sign a waiver, as this IRA is separate property that cannot become community property, and there is no way in which he could become owner of any part of this IRA. If you cannot elevate your position to more informed staff at this bank, you may have to transfer this inherited IRA to another institution who better understands the legal issues involved. Normally, this would not be worth arguing over with the bank, so I assume that you have reasons for not asking your husband to sign so you can move forward.
Permalink Submitted by JEANNE ATKINSON on Wed, 2016-07-06 20:45
Thank you. I appreciate your response.
Permalink Submitted by Bruce Steiner on Wed, 2016-07-06 21:33
This illustrates that you can live in a community property state and still have separate property. You could also live in a common law state and have community property (if you earned it while married and living in a community property state).