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    jmikl's Avatar
    jmikl Posts: 1, Reputation: 1
    New Member
     
    #1

    Mar 9, 2007, 03:00 PM
    Inheritance tax
    Recently, my wife's parent died and left among other thing an IRA in the amount of ~ $400,000 to be divided between 4 daughters.

    My question is about personal tax liabilities. Since this is an IRA and the original holder was > 70.5 years of age we were told the distribution needs to continue. I would like to receive a lump sum but am worried about tax liabilities Federal and NYS. Is there a deduction for a lump sum or anything that can eliminate or reduce the personal inheritance tax? Any suggestions on which tax documents to read?

    How about Florida? Anyone can advise us?

    Thank you all

    Cheers:confused:
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,818, Reputation: 846
    Senior Tax Expert
     
    #2

    Mar 11, 2007, 08:48 PM
    You are NOT paying inheritance tax.

    You are paying INCOME taxes on the monet from the IRA which was tax-deferred.

    There IS an option of rolling the money over into your own IRA, but that has to be handled correctly. Go to a local tax professional with experience in IRA rollovers. Make sure he/she is aware of the new law that allows this rollover.

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