Hi,
My mother died in 2019, and in 2020 I received an inheritance. My brother, the trustee of her accounts, indicated that we did not have to pay tax since the amount of the inheritance fell under certain limits.
However, what are those limits, and is there some form we need to file to declare the money received?
I already filed my 2020 taxes, and only included investment gains on the moneys in Schedule C. If I need to make amends, what should one do?
Thank you.
You do not declare your inheritance. A person who receives a cash inheritance does not pay tax on it and does not report it in any way.
An estate has to pay federal estate tax if the total value of the estate is more than a certain amount. For someone who died in 2019 the limit was $11.4 million.
Some states have estate tax with lower limits. A few states have an inheritance tax that is paid by the person who receives the inheritance. If your brother worked with a tax specialist I'm sure they covered all of this. I don't think you need to ask him anything.
What exactly did you inherit ? Cash, property, retirement accounts, broker accounts, etc ?
Did the estate file a final return ?
I inherited cash. It was divided 3 ways between her trust account (for her three children), and my father's trust account (for all his children - she was his second wife).
I believe that my brother worked with a tax specialist to file a final return. What questions should I ask him about this?
Thank you for the quick reply.
You do not declare your inheritance. A person who receives a cash inheritance does not pay tax on it and does not report it in any way.
An estate has to pay federal estate tax if the total value of the estate is more than a certain amount. For someone who died in 2019 the limit was $11.4 million.
Some states have estate tax with lower limits. A few states have an inheritance tax that is paid by the person who receives the inheritance. If your brother worked with a tax specialist I'm sure they covered all of this. I don't think you need to ask him anything.
Good ... the estate return is done and you all have non taxable cash to spend as you like ... nothing to report on an income tax return .
Well thank you.
That is a relief. I filed mid-October, but still haven't received the refund. Was wondering if I had screwed things up by not-declaring.
I have an inheritance that sent me a 1099R that shows a taxable amount. how do i report this on my tax return to avoid questions and avoid any tax?
An inherited IRA may be taxable, depending on the type. If you inherit a Roth IRA, you're free of taxes. But with a traditional IRA, any amount distributed is subject to ordinary income taxes.
Please give more details if you have further questions.
DO I need a form for an Inheritance on real estate my late Mother had