Or are inheritances not taxed?
2006-12-24 05:22:33 · 6 answers · asked by Mark B 2 in Business & Finance ➔ Taxes ➔ United States
Are you talking about an inheritance you have received or are you planning for your ultimate demise?
If you have received an inheritance, it will have been taxed already. You do not even have to report its receipt. It would be a good idea to keep documentation to show that it was an inheritance though, in case the IRS ever audits you for anything else.
if you are thinking about your ultimate demise then anything willed to your widow (as opposed, say, to your best friend) is not taxed at that time. However, on her death, it will have to be considered for estate tax purposes. so all you are doing is deferring it. If you have a substantial estate you might want to have a comprehensive review of your wills and put some sensible planning in place. Standard will-writing programs work when all you want to do is secure your spouse's financial future and provide a bit of order. Nothing beats customized advice if you have assets which may end up being taxed.
The limits mentioned previously are accurate, for the most part, but they can change rapidly especially if we get a change of political party in the White House. Keep your eye on things like that. irs.gov is a good place to start.
2006-12-24 05:52:23 · answer #1 · answered by skip 6 · 1⤊ 0⤋
There is an amount, which I think is 1 million or 1.2 million, below which the IRS does not tax for inheritance. So I would put it in a will, not give it away while alive. Call me a cynic, but what if you get a divorce and you've "gifted" your spouse $$$$$$ to avoid paying taxes on it? Or what if your spouse dies first?
2006-12-24 05:35:24 · answer #2 · answered by Michelle G 5 · 0⤊ 0⤋
If you give less the 11,000 away you will still need to pay inheritance tax. If you gave more the 11,000 then you the (person giving the gift) are subject to the gift tax. The gift tax is equal to the inheritance (estate) tax. The gift tax was created to prevent people from giving the estates away in order to avoid tax. The gift tax is imposed on the giver not the recipient of the gift.
2006-12-24 13:18:37 · answer #3 · answered by andjuw 2 · 0⤊ 0⤋
Inheritances are not income taxable - except for IRA accounts. Big estates over 2 million pay Federal Estate Tax before you get the money so gifting later makes no difference.
2006-12-26 03:11:57 · answer #4 · answered by spicertax 5 · 1⤊ 0⤋
Brian - tax avoidance isn't fraud. Tax evasion is. undecided of each and every of the main factors, yet i believe if the value of the home is below 250,000, then no tax is payable. If the deeds are transferred to somebody else at the same time as the 'giver' remains alive, then i think of another tax is payable, and the unique proprietor isn't allowed to stay interior the residing house. terrific to learn those factors, because of the fact i'm no longer easily constructive of the data!
2016-11-23 15:16:46 · answer #5 · answered by ? 4 · 0⤊ 0⤋
I am sure the IRS can spin around on it!
2006-12-24 05:25:01 · answer #6 · answered by Webballs 6 · 0⤊ 0⤋