Maryland Inheritance

[Ravens2020]

How do I report inheritance on my Maryland Resident Income Tax Return?

[SweetieJean]

What type of inheritance (cash, property, a retirement plan?)   Did you receive a 1099-R for it?

Estate/inheritance taxes (which TT does not support) are handled separately from income taxes. See:

Estate and Inheritance Tax (marylandtaxes.gov)

[JotikaT2]

It depends upon what you are trying to do.

Typically, the inheritance tax is paid by the estate on Form MET 1, Maryland Estate Tax Return.  Any tax due would be paid when filing this tax return.

Maryland estate tax filing requirements

If you need to file a trust tax return, you would file that on Form 504, Fiduciary Income Tax Return, to report any income while the estate is being processed but before any distributions have been made to heirs.

Maryland Fiduciary Filing information

If you are trying to prepare your own tax return, you would only need to report any income as earned once the assets have transferred to you.  You essentially only pay taxes on any income generated from the assets after they are transferred to you.

If you have a more specific question, please comment so we can assist you.

[boeing 17]

In 2021, We received bill from State of maryland that needed to be paid in 30 days from inheritance tax due for total amount of 2 investment accounts inherited by my husband from his Cousin, Rebecca Ann Watt who died in 2019.  We paid $14,300 to the State of Maryland and have not received any tax form related to this.

Is there anything that we can deduct from our income related to this large expense?  Thanks for your help!

Ruth Medlock

[boeing 17]

James Medlock received UBS taxable investment account and an Inherited IRA UBS account as well.

Invoice was received from State of MD for 10% of total value of both accounts received two and a half years ago.

Thank you!

Ruth Medlock

[boeing 17]

We are not residents of Maryland but are residents of NH. Because my husband was a cousin and not a closer relative we had to pay Maryland 10% of what he inherited in 2019.  This was not taken from the Estate and IRA distribution prior to distribution to my husband who received a taxable investment account and also an inherited IRA investment account from his Cousin.

Ruth Medlock