• You inherit a bank account  or bonds which produce interest income
• You inherit stocks which produce dividend income.
• You inherit stocks or other investments which you subsequently sell, and as a result produce either a capital gain or a capital loss - both of which are reported for tax purposes.
• You inherit a house - which is not your personal residence and so is treated as an investment asset.

If you inherit any form of investment property,  that inherited investment property if it produces any form of income in the form of interest or dividends, then the paid-out income is taxable and is reported on a Form 1099-DIV or 1099-INT, addressed to the recipient (presumably you!)  

If you inherit a retirement account such as an IRA or pension or Annuity, the distributions from that deferred income account may be in whole or in part taxable and the taxable component is usually reported on Form 1099-R.  You would need to spell out the form of the annuity [immediate, deferred, variable, etc.] for an answer to be given on what to expect might be taxable.  N.B. Some states tax distributions from an IRA, and some only tax the income generated within the IRA but not the value of the contributions paid into the IRA.  Good records are absolutely necessary to determine what is taxable at the state (not Federal) level.

 If you sell inherited property, then you will pay a tax on capital gains based on the FMV of the property at the decedent's date of death, or report a capital loss [in either case, the term of ownership is defined as Long-Term], as reported on Form 1099-B or Form 1099-S if the asset was the decedent's house.  Date of acquisiton will always be the date of the death of the person whose estate distributed to you the property.  

Sale of a House that is Inherited:

If you sell a house previously used as the personal residence of the decedent, and if you or a related party has not subsquent to that death occupied the house, then the following applies:

1. Unlike a house sold by a living resident/owner, there is no $250,000/$500,000 capital gains exclusion available.
2. Unlike a house sold by a living resident/owner,  there may in fact be reportable deductible capital loss.
3. You report your Cost Basis of the house sold to be the Fair Market Value of the house on the date of death of the decedent from whom you inherited the house and the date of acquisition is the date of death and the Holding Period is "Long-Term" no matter how long you actually owned the house as an inheritance.
   Add to the Cost Basis any fix-up costs or costs of selling, such as agency fees.
4. You will pay a tax on capital gains or report a capital loss in a manner similar to any investment asset.

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GIFTS:

• The recipient of a Gift has no Income Tax Liability for the value of the Gift.  
• The Donor may have to review the rules regarding Gifts, if any one Gift from one person
  to one other person is greater than $15,000 in one year.  This is not income tax and 
  is  the responsiblity of the Donor not the recipient.  viz., IRS Form 709

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"Inheritance Tax":

There is no Federal inheritance tax. If the estate was greater than $5.6 million [less any Lifetime Gifts filed on Form 709], the Estate had to pay the estate tax then that would have been paid before any distribution of the inheritance to the beneficiaries,  For Tax Year 2018, the estate and gift tax exemption is $5.6 million per individual;  that means an individual can leave $5.6 million to heirs and pay no federal estate or gift tax. A married couple will be able to shield $11.2 million from federal estate and gift taxes for deaths in 2018.

However, a few states do have inheritance taxes.  Currently, a small handful of states and the District of Columbia collect an estate tax at the state level. Six states listed below collect an Inheritance Tax at the state level, and two of the states listed below collect both an estate tax and an inheritance tax. Your relationship to the deceased party from whom you inherited the asset very much determines whether or not you are liable for the Inheritance Tax and what rate of tax is assessed.

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State Inheritance Tax, and Federal or State Estate Tax, are not a part of the Income Tax system.  

TurboTax only supports Income Tax filings.
Inheritance Taxes and Estate Taxes are not allowable deductions, in general, on Income Tax filing

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The ONLY STATES with INHERITANCE TAX on bequests to beneficiaries are:

• Iowa           - no tax assessed if decedent's estate is under $25,000
• Kentucky
• *Maryland    -lowest top  tax inheritance tax rate pf 10%; small estates of under $30,000 exempt
• Nebraska   -highest  top tax inheritance tax rate pf 18%
• *New Jersey
• Pennsylvania

All six states exempt spouses, and depending on state, exemption varies for immediate relatives.

• * State collects both estate and inheritance tax where noted