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If you are taking RMDs you don’t need and expect to leave money to your kids, the type of account they inherit can change the tax bill. Here’s why a taxable account can sometimes beat an inherited traditional IRA.

Roughly 1 out of every 6 dollars in the Textron Savings Plan sits in the Textron Stock Fund, and most people holding it never chose to buy it. Net unrealized appreciation can change how that stock gets taxed, splitting it into cost basis taxed as ordinary income now and appreciation taxed as a long term capital gain later. The election is permanent, and rolling the shares into an IRA first generally ends it. Here is what has to happen, and when a full rollover is still the be