Q: My sister is ATF on my father’s account and my father is thinking of disrupting our inheritances now before he passes away. Does she need to be present for him to do so? (Uniontown, PA)
A: I think calling in the ATF is a bit drastic. I am not sure what “ATF” means to you. I associate it with the Federal Bureau of Alcohol, Tobacco and Firearms. If you mean, POA as in Power of Attorney, I can answer your query. The person who appoints an Agent to act on his behalf under a POA is called the Principal. Generally, the Principal (in your case your father) can do as he pleases even after they have appointed someone as their Agent (your sister) on a POA. If the person is declared disabled or incompetent, then the powers of the POA come into effect.
Q: I am investing my money (trying to grow it beyond being in a regular savings account) and my mom has around $10K that she would also like to add to my money but we are afraid it may raise red flags with the IRS. The transition would be from one bank to a different bank. Also, I am in Pittsburgh, she is in South Carolina. (Regent Square, Pittsburgh, PA)
A: I think you should ask the bank you plan on depositing these funds in to. My recollection is that businesses must fill out an IRS form for every check or cash in the amount of $10,000.00 or over. I believe banks only report deposits from individuals to the IRS if it is cash or of a suspicious nature. These types of deposits occur frequently and the bank doesn’t like to turn in their own good customers. Another consideration is Federal Gift Tax. This amount is under the Federal Gift Tax limit and therefore there would be no concerns regarding your mother’s income taxes. Also, you may want to consider the potential consequences of this transfer if mom needs to apply for Medicaid in the next five years. If she does, this transfer may be render her ineligible for the value of the transfer to you.