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HOW DO I SHOW AN INHERITANCE PAYMENT ON THE TAXES
That depends on how it is reported to you.
On a 1099-R?
On a K-1?
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HOW DO I SHOW AN INHERITANCE PAYMENT ON THE TAXES
Generally speaking, inherited cash (money) is never taxable.
If you inherit assets, that are sold after the person's death and converted to money (such as stocks, other investments, or a home) then you owe tax on the increase in value (if any) between the date of the person's death and the date of the sale. Such income might be reported on a 1099-S (for a home) or a 1099-B (for a brokerage account).
If the estate earns income that is passed to you, it may be taxable although the principal may not be. Estate income may be reported on a K-1.
If you inherit a tax-privileged account like an IRA, 401(k), pension or annuity, it is probably taxable to you because the contributions were pre-tax (never taxed) so the withdrawal is always taxed, whether it was withdrawn by the original owner or an heir. This kind of income is usually reported on a 1099-R.
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