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On ssi disability in California for several years and received

 
 
 

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On ssi disability in California for several years and received a letter from IRS for taxes in the amt. Of $7000.00 for a purchase of car made with. Obey inherited from my parents. Am I responsible for any taxes, state or federal on any of these issues?

Submitted: 1005 days and 15 hours ago.
Category: Legal
Status: CLOSED
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Posted by Mary M., Esquire 1005 days and 14 hours ago.

Response From Expert

Is the IRS assuming that you had undeclared earned income because you purchased a car using cash?

 
 
 
 
 
 
1005 days and 14 hours ago.

Customer Reply

Yes. It seems because I paid cash it has activated their inquiry.

 
 
 
 
 
 

Accepted Answer

Typical IRS. Gather all of the evidence together that you can regarding the inheritance that you received that year (Mom's death cert., estate payment info and/or life insurance info and/or banking info) and prepare a letter to the IRS in response to their inquiry explaining to them that it was nheritance monies that aided you in the purchase of the car and nothing more. Be certain to tell them the exact amount of the inheritance (don't worry -- inheritance tax does not kick in until the amount being inherited exceeds a few million dollars). Explain to them that the only "income" you received that year (and every other year) is from SSI Disability. By showing the IRS the chain of where the money came from, you should not have a problem and you do not need a lawyer. However, if for some rason they refuse to accept the materials regarding the inheritance that you received, then at that point, you should discuss this with a tax attorney.   

Good Luck. If the facts as are you presented and you can show the chain of inheritance you should not have any problems sorting this matter out.

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Expert: Mary M., Esquire
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Answered: 8/22/2009

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13 years experience in general law: RE, Consumer Prot., Family, Wills & Estates, Emplymnt, Crim Law

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