Coleen3
Intuit Alumni

State tax filing

Cash received as an inheritance is never taxed Federally. See below for Oregon.

Income Taxes

Inherited assets may be subject to income tax depending on the type of assets you inherit. Most inherited assets fall into one of 3 broad categories: 1) Tax free, 2) Taxable now, and 3) Taxable later (maybe).

Tax Free

Tax free assets include things such as cash or life insurance proceeds paid out upon the death. While cash accounts and life insurance proceeds are included in the value of the decedents estate (for estate tax purposes), they are generally income tax free. Therefore, if part of your inheritance is related to Aunt Sally’s bank account or the proceeds from her life insurance, it’s probably tax free.

[Edited 2/17/2019 [4:50PM]