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Level 1
posted Jun 28, 2023 10:06:28 AM

Gifts and inheritance taxes

This year a friend gave my husband and me monetary gifts totaling $35,000.

He also had us listed on his checking account to be paid on his death $103,319.19 EACH for a total of $206,638.38.

What do we need to set aside for when we file our federal and state income taxes?

0 2 638
2 Replies
Employee Tax Expert
Jun 28, 2023 10:10:30 AM

Hi @ncflamingogirl2,

Thanks for the question. What a great friend to have 🙂 So a gift and also inheritance may or may not be taxable to your friend who gave. It is not considered income for your income tax return, so it will not be reported on your tax return. Here's a quick guide for you: Gift tax guide  

Employee Tax Expert
Jun 28, 2023 10:12:15 AM

A cash inheritance is not taxable at the federal level.  You should check your state for it's rules, as they all differ.

 

GIFTS:

  • The recipient of a Gift has no Income Tax Liability for the value of the Gift.  
  • The Donor may have to review the rules regarding Gifts, if any one Gift from one person
    to one other person is greater than $17,000 in 2023.  This is not income tax and 
    is  the responsibility of the Donor not the recipient.  viz., IRS Form 709