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New Member
posted Jun 1, 2019 10:56:40 AM

Do I report an inheritance in Pennsylvania if the estate paid all the taxes?

I am a resident of Pennsylvania and received an inheritance from a PA resident. The estate of that person paid all the taxes that are due on my inheritance. Do I still need to report it on my PA income tax return?

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1 Best answer
Level 9
Jun 1, 2019 10:56:41 AM

An inheritance is not taxable on a PA income tax return.  However, it is used to calculate your eligibility for the PA Tax Forgiveness Credit.  If you received a K1 from the estate administrator, that income IS reported and taxable on your individual PA income tax return.  The K1  reports income earned by the estate prior to its distribution to the beneficiaries. 

2 Replies
Level 9
Jun 1, 2019 10:56:41 AM

An inheritance is not taxable on a PA income tax return.  However, it is used to calculate your eligibility for the PA Tax Forgiveness Credit.  If you received a K1 from the estate administrator, that income IS reported and taxable on your individual PA income tax return.  The K1  reports income earned by the estate prior to its distribution to the beneficiaries. 

New Member
Jun 1, 2019 10:56:43 AM

Not unless exceeds a certain threshold figure