PDA

View Full Version : Inheritance Tax


ddn_77077
Jan 24, 2011, 12:16 PM
My father passed away and my brother, sister and I inheritated his paid townhouse. We sold it in 2010 and divided the monies due to his request in his will. We do not have to pay taxes on an inheritance, correct? Title company says the substitute 1099 was with closing paperwork. My sister was advised by H&R Block that we don't have to mention it at all since the dollar amount was only a total of $50K. I'm getting tossed back and forth. Help!

JudyKayTee
Jan 24, 2011, 12:29 PM
If there was a Will the estate was admitted to probate.

What State (although it matters little)?

Who gave you the 1099?

ebaines
Jan 24, 2011, 03:16 PM
There seems to be three questions wrapped into one here.

1. Regarding estate tax - there is no estate tax to pay for deceadants who passed away on 2010, but there would be a requireent to file an estate tax return if the value of the estarte exceeded $1 million. Since that seems to not be the case, no need for the executor to file an estate tax return. I suspect thius is what the H&R Block person was talking about.

2. You are correct that there is no inheritance tax at the federal level, but some states DO have an inheritance tax. Tell us what state the property is located in, and what state you live in, and we'll investigate that for you.

3. Since you sold the property you may have a capital gain to report, if your portion of the proceeds is more than your portion of the cost basis in the property. Your cost basis is equal to your portion of the fair market value of the home as of your father's date of death. If the proceeds you received is greater than that, you would owe capital gains tax on the difference, and you would report the sale on Schedule D of your form 1040 tax return.