Hello and thanks to those of you who have given me guidance on this topic before. My parents both passed away this year and I put all their cash assets into an estate bank account including from the sale of their home. The estate is about to be closed in probate and all debts have been paid. I understand that as a sole heir, I will not owe taxes on this inheritance. (I hope that is accurate as it is under the limit for inheritance taxes). The one asset that I did not "cash out" and deposit into the estate account is my Dad's 401k. Since the stock market is down right now, I did not want to "sell low." I had the assets transferred to the name of the Estate and its Tax ID number.
Here are my questions:
1). Do I have to cash this out now and add the cash to the estate bank account prior to the probate close?
2). If I do have to cash it out, would I report the income and taxes on the Estate tax return?
3.) If I don't have to cash it out now and it stays under the Estate tax ID, are there limitations on how long it can stay under that Tax ID?
Thanks for any advice you can offer.
