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Lev, Tax Advisor
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Experience:  Taxes, Immigration, Labor Relations
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I live in Hawaii and my mother recently passed away in California

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I live in Hawaii and my mother recently passed away in California leaving me around 180,000. Do I have to pay taxes on this? Is tax on this taken out before I get it? Or if I pay it about how much would the taxes be percentage-wize ?
Hi and welcome to Just Answer!

Please see for reference IRS publication 525 - page 34

Gifts and inheritances. Generally, property you receive as a gift, bequest, or inheritance is not included in your income. However, if property you receive this way later produces income such as interest, dividends, or rents, that income is taxable to you. If property is given to a trust and the income from it is paid, credited, or distributed to you, that income is also taxable to you. If the gift, bequest, or inheritance is the income from the property, that income is taxable to you.

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There is no federal estate tax for estates below $5,000,000.

There is no inheritance tax neither on the federal level nor in California.

Only if part of your inheritance are funds in any tax defered account - such as 401k, IRA, etc - the distribution would be taxable.

Also any earnings credited after your mother died - will be taxable.

However the inheritance itself is not taxable and is not reported on your income tax return.

Please let me know if you need any help or clarification.


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