[monseam6]

I am the executor of my late mom's estate. She left the proceeds of the sale of the property to the grandchildren. The check was written out in my name and I divided it up and gave each grand child there share. Do I have to include that amount in with my taxes and what do I do about the amount the title company took out for taxes?

[tickle]

I am assuming your mom had a 'company'; I get that from your statement about including the amount the title company took out for taxes. So you really do have to explain a little bit more if you want a proper answer.

As to your first question. You don't include the amount in 'your taxes' you include the amount in the estate taxes, or your mom's final tax return.

Tick

[monseam6]

No, she did not have a company, just some property in the hills. She passed away 7 years ago and left the property(when it sold) to the grandkids. The property sold for $125,000. The title company here in California set aside $3000 taxes (we were told that it is the law).

[ebaines]

Monseam6 - as executor you personally do not owe any taxes for anything. If the estate owes taxes to the State of CA because of the sale then that amount is paid by the estate BEFORE distributing the remainder of cash to the heirs. It sounds like that's exactly what happened here, so that's good. Now you should investigate whether in fact the $3K is actually owed by the estate - you would file an income tax return on behalf of the estate and see if any of that money can be refunded to the estate, or whether the estate actually owes more.

One other thing - all of these transactions should be done using the estate's checking account, not yours. You should keep some cash in the estate's checking account and not finalize distributions to the heirs until you are sure that all final blls that are owed by the estate (including taxes) are paid off. Then a final distribution can be made to the heirs and the estate finally closed.