We have a lot of cases where couples are in second marriages and each has children of their own.

If the child is the direct beneficiary, then all of the IRA assets go to the child upon the mother's death and are subject to income tax.

Upon death, heirs receive a step-up in basis.

Our estate tax laws allow the heirs to inherit property with a new cost basis which is equal to the fair market value.

This is not an uncommon type of estate planning. There are lots of people with sizable retirement plans with a single child as beneficiary, or minors as beneficiaries.

These issues are extremely complicated.

Life insurance is an important method of estate transfer to at least consider because death benefits can pass to your heirs essentially free of taxes.

If you inherit a checking account with $82,000, then there is no step up in basis.