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Old 08-05-2011, 08:33 PM
 
Location: Las Vegas
13,877 posts, read 25,302,878 times
Reputation: 26334

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Probably naive of me but I always heard there were no estate taxes unless the estate was over a certain amount of money. I'd also read insurance payouts were tax free. Do more checking than I did....or my parents. I ended up owing a lot of money for taxes on an inheritance my mom had told me was tax free.

If you are planning on leaving things of value to others learn about the tax liability associated with the inheritance. If you can, pass the information on to the other people involved. You could save them a lot of heartache.

I ended up having to pay an extra 7K in taxes and it was hard. I probably would have been better off without the inheritance. Or I should have been told to save half of whatever I got for taxes.

I guess all the freebies are only for the rich!
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Old 08-05-2011, 08:55 PM
 
Location: earth?
7,288 posts, read 10,847,719 times
Reputation: 8956
I thought the death tax expired in 2010.

What did you pay taxes on (not how much, but what kind of settlement? Was it a trust inheritance, a probate inheritance, or did you sell property and have to pay taxes on that, or something else???)

Wasn't the former death tax calculated on the size of the estate and the particular year?

In which year did you incur taxes and do you recall the rate of taxation?
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Old 08-05-2011, 09:01 PM
 
Location: Florida
2,291 posts, read 4,943,236 times
Reputation: 5236
Not sure what happened in your case. My father died everything except his home and car were left to me as his beneficary. I sold the house and the car and paid no tax at all.
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Old 08-05-2011, 11:22 PM
 
Location: Prescott Valley,az summer/east valley Az winter
2,042 posts, read 3,626,278 times
Reputation: 7884
unless you inherited several million you had a very poor lawyer~ get it checked~ you may be due a refund
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Old 08-06-2011, 12:11 AM
 
Location: Out there somewhere...a traveling man.
39,522 posts, read 47,675,353 times
Reputation: 110324
Estate Tax Rate and Limits

^This site should answer all your questions about estate/inheritance taxes^
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Old 08-06-2011, 01:32 AM
 
71,461 posts, read 71,629,249 times
Reputation: 49027
maybe you were over the limit for your state,many states have a lower limit than the federal. .. maybe they were ira acccounts ,but in either case you pay the taxes out of what you get so im not sure why you say you would have been better off not getting it.

something here makes no sense.

leave me any taxable money and ill gladly pay the taxes on it
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Old 08-06-2011, 04:11 AM
 
Location: Forests of Maine
30,669 posts, read 49,416,421 times
Reputation: 19119
We recently were beneficiaries of two inheritances, no taxes.
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Old 08-06-2011, 05:56 AM
 
5,822 posts, read 13,308,406 times
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Possibly you were required to pay capital gains tax not inheritance.
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Old 08-06-2011, 08:22 AM
 
Location: Las Vegas
13,877 posts, read 25,302,878 times
Reputation: 26334
Mom had an annuity she took out expressly to fund a small inheritance for me and my sister. Turned out the annuity itself was tax free but the interest it had earned was not. Then there was a life insurance policy. Same thing....the policy payoff was tax free but there was interest on the policy that wasn't.

It wasn't some huge inheritance. I got about 22K that I thought was tax free. Surprise!
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Old 08-06-2011, 10:51 AM
 
71,461 posts, read 71,629,249 times
Reputation: 49027
its still a win , if you got 22k and some is taxable so be it. thats how things work. inherit a traditional ira and its the same thing. you will owe the taxes.
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