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Asked 1/25/2011

Will we have to pay inheritance taxes on our inheritance in TN?

We recently cared for our close friend that passed away. He left us 100,000 as our inheritance. We live in TN. This money was from the sell of his home and checking account. Will we have to report this as income and do we have to pay taxes.

 
 
 
 
 
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Answer 1/4 - Submitted 1/25/2011

That's a close friend! Tennessee has an inheritance tax that is designed to favor all but the most wealthy. For people who have died 2006 and beyond, they must have donated in excess of $1,000,000 for the inheritor to have to pay inheritance tax. That means you are exempt from the tax.

I'm sorry about your loss - enjoy your windfall!

 
 

Answer 2/4 - Submitted 1/25/2011

Do I have to report this as income on my taxes?

 
 

Answer 3/4 - Submitted 1/25/2011

No, you do not have to report this as income if your friend died last year.

Did your friend die last year? There are no estate taxes for the year 2010.

Normally it depends on whether the estate paid the taxes(in this case none) before they give the money to you or not.

 
 

Answer 4/4 - Submitted 1/25/2011

What if the attorney is submitting a 1099 to the IRS for our inheritance?

 
 
 
 
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