[Lqohana]

My uncle passed away in Wisconsin, I live in California. I will be receiving somewhere between $60,000.00 and $80,000.00. Approximately $55,000.00 is in stocks and the rest is in cash. How much of this money should I set aside to pay for taxes?

[ebaines]

You do not need to set aside anything for taxes because of your inheritance. Neither CA nor WI have an inheritance tax, and there is no federal inheritance tax either.

Just to be clear: this does not mean that your uncle's estate does not owe any estate tax - just that you as an heir do not need to worry about paying any taxes yourself on your inheritance. If there are any estate taxes due the executor of the estate takes care of that before distributing the remaining assets of the estate to the heirs.

One thing to be aware of since you are receiving stocks is that you need to know the cost basis for then. If your uncle passed away in 2009 or earlier it's pretty easy - the tax cost basis for the stocks is equal to their fair market value as of the date of death of your uncle. In other words, the basis is "stepped up" so that when you sell the stock you will determine any capital gain you may owe based on the value of the stock when he died. However, if yoir uncle died in calendar year 2010 - when there is no federal estate tax - this provision does not apply, and your cost basis is the same as your uncle's original cost basis for the stock. So be sure to ask the execeutor what that cost basis is - you will need this information when you sell the stock.