My inheritance from abroad

mojdeh123 · ‎June 5, 2019

Hi. I am a legal permanent resident. My parents passed away abroad. They never came to the USA. I am receiving my inheritance gradually from abroad. I paid some taxes on my inheritance in that foreign country. Should I inform about my inheritance which is coming from abroad? How about the taxes I paid there? If yes, how? Thank you very much. Have a great day!

ToddL · ‎June 5, 2019

You do not have to report or pay U.S. tax on inheritances, whether from U.S. or foreign sources. For this reason, any foreign tax paid on the inheritance ("estate tax"), is not deductible or creditable on your U.S. tax return.

You do have to report any income generated by the inheritance proceeds, i.e. dividends or interest. Foreign tax on that income is deductible or creditable on your U.S. tax return.

Finally, the foreign account in which the inheritance is kept may be subject to U.S. reporting requirements.

See Report of Foreign Bank and Financial Accounts (FBAR)

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ToddL · ‎June 5, 2019

You do not have to report or pay U.S. tax on inheritances, whether from U.S. or foreign sources. For this reason, any foreign tax paid on the inheritance ("estate tax"), is not deductible or creditable on your U.S. tax return.

You do have to report any income generated by the inheritance proceeds, i.e. dividends or interest. Foreign tax on that income is deductible or creditable on your U.S. tax return.

Finally, the foreign account in which the inheritance is kept may be subject to U.S. reporting requirements.

See Report of Foreign Bank and Financial Accounts (FBAR)