Is inheritance money taxable?

Answer by  answerqueen (564)

In a word, yes. Inheritance money is essentially income to you and is taxable and will need to be reported on your income taxes. You will need to provide documentation of any monies you inherited throughout the year to your tax provider, and remember, the higher income you have or more you inherit, the more tax you'll owe.

Answer by  Chaneygirl (1755)

Possibly. Most non retirement funds are run through the estate which pays the taxes. Life insurance proceeds are not taxable. Retirement money (not roth) is taxable ot the beneficiary.

Answer by  OldMrGoober (40)

Cash you inherit is not taxable to the heir. In addition, any property you inherit will have its basis stepped up from original cost to market value.

Answer by  tamarawilhite (17883)

If the amount you inherited is large enough to be taxed at the inheritance tax rate (over one million, in most states), yes, you pay it.