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My grandfather passed away in August. He has left myself and my brother a significant amount of money which we have not received yet because my dad has to have his name placed on all of my grandfathers accounts. My dad was not the executor of all of his accounts so that has been an ongoing process with the state to become the executor so that the inheritance can be distributed amongst us. My question is with the Bush tax breaks potentially being rolled back on December 31st including the "no death tax" will I have to pay the 55% tax on the money if all of the legal issues are not taken care of by then? Or because my grandfather passed away in August will the tax not hit the money because it was during the time period of their being no death tax. I hope I explained this clear enough! Any help would be much appreciated
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First, the executor takes care of taxes, before distribution to beneficiaries. Just to clarify.
As stands now, there is no estate tax for 2010. However, there have been talks of that being changed. So, no estate tax, unless the estate tax is changed retroactively for 2010.
Sounds nice, but this creates all sorts of new tax problems. I was just reading an article about how the IRS hasn't issued much guidance for any assets inherited in 2010. Cost basis is usually stepped up to the value on the date of death, but not so for 2010 - see article below.
If you inherit cash, it wont' matter. But if you inherit stocks or real estate, it's kind of a tax nightmare.
The Unsolved Estate-Tax Problem - Personal Finance - Estate Planning - SmartMoney.com -
Thanks for the article! I am only inheriting money, no stocks or property or anything. So it looks like I should not have to pay any taxes since the death was in 2010. Looks like this will be a mess if people are getting stocks etc.Comment
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