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posted Oct 21, 2022 6:03:09 PM

The money from my mother's estate was split up 3 ways between my siblings and me, do we have to claim that money as income?

My mother died in 2021, everything was sold in 2022

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3 Replies
Level 15
Oct 21, 2022 6:07:12 PM

Maybe.  Ask the accountant.  You might get a K-1 from the Estate tax return.  Depends what the money was from.  Like any investment sales or house sale.  

Level 15
Oct 21, 2022 6:55:05 PM

Simple answer: No.  Money and property you inherit is not taxable income.

However, portions of the distribution may be taxable income. For example, dividends and interest paid after the decedant's date of death (DOD). If an asset, like her home, was sold for more than it was worth on the DOD, the capital gain is taxable income.  If you are the benrficiary of her IRA or retirement account, that is usually taxable income.  If there is taxable income, the estate administrator usually sends out an IRS form K-1 to notify you of the taxable portion.  You would receive a 1099-R for an IRA/pension distribution.

 

 

Level 15
Oct 22, 2022 4:35:34 AM

 

everything was sold in 2022
 
What was sold ?  Who sold it ?   You or the estate ?   Seek local professional assistance to see what is taxable not only to the feds but also the state.