Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: MONDAY, November 1, 1993 TAG: 9310300042
SECTION: MONEY PAGE: A-10 EDITION: METRO
SOURCE: MAG POFF
DATELINE: LENGTH: Medium
A: There are two ways to find information about the status and addresses of insurance companies.
One is to call the "hot line" of the Virginia Corporation Commission at (800) 552-7945.
A recording will lead you through the choices, but be prepared to punch 1 to select the Bureau of Insurance. When you get the bureau line, you must press 1 again for information about addresses of insurance companies.
The second way is to check the Best rating guide for insurance companies. You should find a copy of it at your public library.
Home Beneficial of Richmond has an office in Roanoke. A spokeswoman there said you would have to apply through the Roanoke office for the proper forms to cash in the policy. You can write to Home Beneficial Life Insurance Co., P.O. Box 12088, Roanoke 24022.
F. Courtney Hoge, who owns an insurance agency in Roanoke, said Peoples Life Insurance Co. of Washington has merged with another company. It is now Peoples Security Life Insurance Co.; its address is 300 W. Morgan St., Durham, N.C. 27701. You should write and ask for the proper forms.
Hoge said many insurance companies have names that begin with the words Continental Life, so he could not trace it. He suggested that you get the exact name from the policy and call the State Corporation Commission's Bureau of Insurance.
800 number means caller pays
Q: I'm curious about the Jane Bryant Quinn article on the Money Page for Oct. 25. It refers to Money Minds in Glenview, Ill. It says they charge $3.95 a minute for giving financial advice by phone, but it gives an 800 number. How can an 800 number charge $3.95 a minute?
A: The hallmark of an 800 number is that the owner of the number called pays the toll charge.
When you dial a 900 number, on the other hand, the timing of the length of the call is automatic, and the charge appears on your telephone bill.
A spokeswoman for the company said Money Minds pays for the phone call, hence the 800 number.
When the call is established and the person is about to ask a question, she said, the financial planner "hits the button" on the timer. The time for the question and answer is recorded by the company itself. The amount of the charge, typically $27.65 for seven minutes, goes on the caller's Visa or MasterCard.
No estate tax to pay
Q: My mother-in-law, who lived in a distant community in Virginia, passed away in February. My wife, her only child, inherited everything.
Her mother left $85,000 in bank CDs and other investments. Her only other asset was the house in which she lived, which was worth about $65,000. About five years ago, she hired a lawyer and put the house in my wife's name. No taxes were paid then, and the lawyer never mentioned a problem at that time.
Do we have to pay estate taxes on the total of $150,000 in my mother-in-law's estate?
A: James B. Taney, a certified public accountant with the Roanoke firm of Anderson & Reed, said the estate tax applies only to estates worth more than $600,000. You do not have to file an estate tax return when the total value is $150,000.
The $65,000 gift, however, is a problem because the law limits gifts to $10,000 a year from any one donor to any one recipient. Your mother-in-law was responsible for filing a gift tax return when the property was transferred five years ago.
But the excess gift of $55,000 would be counted against the $600,000 limit on a total estate. Because her estate is below this lifetime total exclusion, no taxes were due then or now, even though a return was required.
Taney would clear up the matter by filing a gift tax return now, even though you don't owe any money. Your wife can perform this chore as part of settling her mother's estate, assuming she is the executor or administrator.
Your mother-in-law's action will cost your wife money, however. Your wife must take her mother's tax basis in the house, which is probably very low. It would be the amount paid by your mother-in-law for the house plus any improvements. When the house is sold, your wife must declare the gain from this old figure and pay the taxes.
If your mother-in-law had simply willed her home to your wife, your wife's tax basis would have been the value of the house on the date of your mother-in-law's death.
Mag Poff will help find answers to your personal finance questions. Send them to her at the Roanoke Times & World-News, P.O. Box 2491, Roanoke 24010. Or call (703) 981-3434; when asked for a mailbox number, press 66639 (MONEY), followed by the # symbol.
by CNB