Today TaxMama hears from Joan in Minnesota, who asks. “How much money can you inherit in Minnesota without paying taxes on it? And if you do need to pay, what is the %?”
In the US of A, you can inherit as much money as there is in the whole world without paying taxes on it.
Heirs don’t pay tax. The estate does.
Now, if you inherit something other than money, like an IRA or retirement plan, annuity or Savings Bonds,
there is a good chance that you will have to pay INCOME TAX on all the earnings inside those accounts that were never taxed to the person who died.
The income tax rate will be at your highest tax rate when the income you’ve drawn is added to your normal income.
And remember, you can find answers to all kinds of questions about inheritances and other tax issues, free. Where? Where else? At TaxMama.com.[Note: If you were subscribed to the e-mailed TaxQuips, you’d be getting other exciting news and tips by e-mail, that never appear on the site. Please click on the subscribe link and join us.]
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