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New Member
posted Apr 4, 2020 12:07:10 PM

I inherited & cashed an IRA from a parent who lived in another state. Do I have to pay taxes on that money in the state my parent lived in or in the state where I reside?

0 3 1200
3 Replies
Expert Alumni
Apr 4, 2020 12:26:57 PM

You would not need to file a state tax return for the state the IRA originated from. 

Inheritances are not taxable on a Federal return. 

These are the states that tax their residents on inheritances:

Iowa, Kentucky, Maryland, Nebraska, New Jersey, and Pennsylvania.

Level 15
Apr 4, 2020 3:31:24 PM

Distributions from an IRA, including an inherited IRA are taxed as income in the state in which the recipient resides.

Level 15
Apr 4, 2020 9:58:47 PM

"Inheritances are not taxable on a Federal return. "

 An inherited IRA is a tax-deferred account, and as such is most definitely taxed on the federal tax return.