Any tax gurus in da house?

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chazroh

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Probably depends on if it’s cash, or in investments. The way I understand it, if in the stock market, and you leave it in, no tax exists(if an in kind distribution is made). If you cash it out, you pay tax on the difference in value from the day the last parent died( or when the estate was valued).
 

Mad Professor

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Most estates won’t. Usually the biggest thing to be careful of is if the value of something increasing greatly after a death 2 years ago. Also estates with revenue generating properties might incur a tax liability for this year that is passed to you. (Lower rate than an estate or trust rate) Mineral rights, commercial properties etc.


Talk to your tax preparer or CPA when you get the distribution. But I have a feeling you won’t own anything from the way you worded your question.
 

nemesis

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I will receive an inheritance in the tune of $45-$50K.
My question is...I'm sure I'll have to pay some sort of taxes on this chunck of change.

If the estate is in the form of property or investments paid for with post tax dollars, there is no tax. There is no tax on inheritance until the amount exceeds $11,580,000. That's for 2020. It will likely change for 2021.

If, however, you were to receive your father's investment account that was paid for with pre tax dollars, such as, a 401K where the employer contributed to the account, then when you withdraw the funds, you'll pay a tax.
 

Glock 'em down

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All this is, my parents estate (house and 10-15 acres) sold for $150K. I have two older brothers, so it will be split 3 ways. The three of us also agreed to give the new owner $2K each to pay for a new road, if needed (don't ask).

So I have roughly $45-$50K coming my way. There are no mineral rights or any thing else standing in the way. This Wednesday, a district judge will sign off on it and I'll receive a check.

I just didn't know if I would be facing any taxes or other hidden fees or charges when this is over.
 

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