How was it reported to you? Was there a tax form to report it? Do you know if the Estate paid taxes on this money?
Inheritances are not considered income for federal tax purposes, whether you inherit cash, investments or property. However, any subsequent earnings on the inherited assets are taxable, unless it comes from a tax-free source.
Be aware that some states will impose an inheritance tax on assets you receive from a decedent’s estate. Check with your state’s taxing authority to determine whether you may owe tax or not.
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