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Do I need to report a cash inheritance?

SOLVEDby TurboTax3520Updated 1 month ago

Not on your federal return. The IRS doesn't impose an inheritance tax.

Only a handful of states (Iowa, Kentucky, Maryland, Nebraska, New Jersey and Pennsylvania) have some kind of inheritance tax. Refer to your state's Department of Revenue to see what the requirements are for filing an inheritance tax.

Interest or other income generated from inherited cash would be taxable. For example, if you inherited $10,000 in cash and deposited it into a bank account, generating $40 of interest this year, the $40 would be included in your income as taxable interest.

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