question on inheritance

I have a tax question that i thought i would throw out here becasue after 3 hours of reading the irs site i am more confused! We inherited some money from a relative that passed. I know we have to pay taxes somehow on it i mean uncle sam is going to get his money. There is no "inheritance tax" but don't we have to claim the money as income? or is it considered a "gift"? I am so confused and don't want to pay umpteen dollars to get a simple answer...anybody know or dealt with this?

i think it depends on how much it is on whether it can be considered a gift or if you have to declare it as income...i would call an accountant to ask so you know for sure

yeah thats what we are going to do just thought i would ask at the off chance someone knew anything

Or call the IRS. It may take you forever to get through(and it will), but I'm pretty sure they don't charge you for you to ask the question. I can ask my mom's boyfriend. He's an accountant. He wouldn't charge for me to ask him lol. ^_^ Want me to? I'll let you know if there's a limit on a gift how high it is and if you have to mark it as income, how low or how high it has to be. k?

A friend of mine is a lawyer and he paid me some decent money to watch his house while he was settling his sisters estate...He told me if the amount stayed under $600 then it doesn't have to be reported as income...I don't know why that was the magic number but it was...I'm assuming that you are probably talking about more than that...And this was about 5 years ago...But every state may be different as well...Although maybe not since we're talking about the federal government...either way good luck

I've actually had good luck calling the IRS with questions. The time I needed to it didn't take that long and the guy was super nice, friendly and helpful. I think maybe I just got lucky..

It's a sham that you have to pay on it too.. because you know it got or will get taxed already going through probate. LAME

I could be wrong but I thought the taxes were paid as estate tax...which is the tax you freakin' pay to die. Knowing our government the deceased has to pay tax to give you money and you have to pay tax to receive it....

well i got good news!!! the estate taxes were all taken care of before disbersment so we get to keep it all no taxes and we don't ahve to claim it as income!!! this is mainly due to the way our relative had it all set up but yea!!!

hooray! I hope it was a lot so yall can have like an AMAZING Christmas this year lol

well it was just enough to pay off all our debt and cars and get my floors done so that is a great chrsitmas for us!...lol

That's awesome Eileen!! I thought it could be covered under the estate tax laws but ya' never know with the way tax laws change...and they don't really bother to tell anybody about the changes!!! I'm glad it was enough to really make a difference for your family! When I sold my bakery back in May I used the money I had in the bank (capital) to pay off our debt and then invested the $$$ from the sale for my boys' college education. It wasn't tons of money (I only wish) but it sure felt good! I know the passing of a loved one is different but I'm sure it's nice to know that they wanted to provide something for your family! :-)

If the money is from an estate... you have to pay taxes, meaning if it was from a liquidation of property you pay. If it is from life insurance, that passes tax free