Is interest taxable?
As with any other bank account, interest earned from a Funeral Trust Account may be taxable to a particular person. In some cases, this is not a problem because the person involved is not earning enough money to be liable for income tax. In other cases, however, this can be a disadvantage. It was for this reason that the Illinois Funeral Directors Association has made available to us a plan for TAX EXEMPT Trust Accounts. Money deposited in these types of accounts still earns interest but it is not taxable. Many people find this approach much more suitable to their particular needs. At the present time, our funeral home has a variety of options available to people concerning how their funds are deposited. Each is designed to best suit a particular persons individual situation. MAY FUNDS BE WITHDRAWN BEFORE DEATH? At Duker & Haugh, when a Funeral Trust Agreement is executed, the funds remain the property of the Patron.
Yes, the interest is taxable. Combat zone rules do not apply. No federal or state tax is withheld. A 1099-INT is issued no later than January 31st for Savings Deposit Program interest. If you do not receive your 1099-INT in the mail you may contact Customer Support to request that it be reissued to you.
