I received a 1099-Misc for a distribution of inheritance. As I understand, inheritance is not taxable income. Is there any circumstance where it would be taxable?
I spoke with the attorneys office, and was told that the primary source of the inheritance was from real estate that was sold. I was told that taxes were paid by the estate. They said to file this "Not my Interest to Pay" and reference the TIN for the Payer. If this is correct, how is this done using TurboTax?
Thanks for any thoughts.
Because it was reported in Box 3, the IRS will be looking for it to be on your return. I would recommend that you call the Attorney that sent you the 1099-Misc and ask why the inheritance was reported as Other Income.
You also need to request he send you a Corrected 1099-Misc removing the amount in Box 3. Some individuals believe that if they remit an amount over $600 they are required the form, when in fact not disbursements are required to be reported to the IRS.
The suggestion that the attorney gave you to state "Not my interest to pay" is not an acceptable method to not to report the income.
Whether you need to report depends on what box the funds are shown on the Form 1099-Misc. Normally inherited funds are not taxable.
We will need to know what box the amount is listed in to adequately answer your question if you need to report the funds and if you do where to report the amount.
I was also told that the estate paid taxes on the sale of the property under the Payer's EIN provided. They said I could just submit this with "Not My Interest to Pay" and refer to the Payer's EIN. I do not see how to do this with TurboTax.
Because it was reported in Box 3, the IRS will be looking for it to be on your return. I would recommend that you call the Attorney that sent you the 1099-Misc and ask why the inheritance was reported as Other Income.
You also need to request he send you a Corrected 1099-Misc removing the amount in Box 3. Some individuals believe that if they remit an amount over $600 they are required the form, when in fact not disbursements are required to be reported to the IRS.
The suggestion that the attorney gave you to state "Not my interest to pay" is not an acceptable method to not to report the income.