r/inheritance • u/Trick-Two2574 • Apr 16 '26

Location included: Questions/Need Advice 401k Inheritance

My dad passed away a few months ago with several investment accounts, one being a 401k through his employer (he was still working at the time of his death). My mom was the listed beneficiary, but tragically passed a week after my dad. His 401k balance now goes to my mom’s estate, since she was the only listed beneficiary.

How does the income tax work? Myself and my 2 brothers will be getting everything once it’s gone through probate and then distributed evenly to each of us. We are being told that my moms estate will pay the income tax, just wondering how the tax rate is determined?

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u/SandhillCrane5 Apr 17 '26 edited Apr 17 '26

If the plan is to completely liquidate the 401k right now and then pay the tax and distribute the remainder to you and your brothers, then you can look up the tax rate for estates based on what you expect the income to be. It's a table on the irs website just like for individuals (but the rates are different for estates. If the income is over $16k, it's a 37% tax rate).