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Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 10131
Experience:  Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
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I am the executor of my mothers will and also her daughter

Customer Question

I am the executor of my mothers will and also her daughter and stand to inherit money from her savings, is this taxable?
JA: OK. The Lawyer will need to help you with this. Have you consulted a lawyer yet?
Customer: No
JA: Please tell me everything you can about this issue so the Lawyer can help you best. Please give me a bit more information, so we can help you best.
Customer: My mother died and I am the executor and on the will I am entitled to 2/3 s and my son 1/3 of her estate, which consist of nothing but money no real estate is involved, just CD's and bank account. Are inheritance taxs required?
JA: Is there anything else the Lawyer should be aware of?
Customer: No
JA: OK. Got it. I'm sending you to a secure page on JustAnswer so you can place the $5 fully-refundable deposit now. While you're filling out that form, I'll tell the Lawyer about your situation and then connect you two.
Submitted: 7 months ago.
Category: Tax
Expert:  Lane replied 7 months ago.
Hi,...No inheritances, bequests and gifts are excluded from income under Section 102 of the Internal Revenue Code...You WILL, of course, begin to be taxed on the interest, dividends, and/or capital gains, once inherited, depending on how you invest or deposit
Expert:  Lane replied 7 months ago.
There would only be ESTATE tax if the estate is more than the lifetime exemption of $5,450,000
Expert:  Lane replied 7 months ago.
SO no taxes at all, at the federal level, (income or estate - there is no federal inheritance tax)...And only a handful of states still have an inheritance tax....Reform and repeal of estate and inheritance taxes have been very frequent in the last few years, sometimes in states you might not expect. In 2013, Indiana sped up the repeal of its inheritance tax, retroactively to January 1, 2013. Tennessee's estate tax will phase out fully in 2016. Maryland and New York are in the process of phasing in new, higher estate tax exemptions, eventually matching the federal exemption level ($5.9 million) by 2019. Minnesota is in the process of doubling its exemption from $1 million to $2 million over five years....If you'd like to let me know your state, I can tell you whether there might be any STATE inheritance tax
Expert:  Lane replied 7 months ago.
Hi,...I’m just checking back in to see how things are going...Did my answer help?...Let me know…...Thanks,Lane…
Customer: replied 7 months ago.
The state is NJ
Expert:  Lane replied 7 months ago.
Thanks for that. New Jersey IS one of the few states that still has an inheritance tax....If your mother left assets with a gross value of more than $675,000, the executor will have to file a New Jersey estate tax return. ...New Jersey has two types of estate tax returns; a simplified form for estates that don’t also have to file a federal estate tax return, (estates of less than $5,450,000) and a regular estate tax return for larger estates....The fee/taxes are paid from estate assets. YOU will likely need to hire a CPA or other tax preparer with experience preparing NJ estate returns (and federal estate tax returns as well, if the estate is valued at more that $5,450,000)...The level of tax paid depends on beneficiary "class." You (as a direct descendant) are a class A beneficiary. This means that you will have no tax....See this, from NJ Dept of Treasury: (I'll underline the pertinent part)..."The Transfer Inheritance Tax rates depend on the amount received and the relationship between the decedent and the beneficiary. No tax is imposed on class A beneficiaries (father, mother, grandparents, descendants, spouses, civil union partners, or domestic partners). Class C beneficiaries (brother or sister of decedent; husband, wife, or widow(er) of a child of decedent; civil union partner or surviving civil union partner of a child of decedent) are taxed at 11%–16%, with the first $25,000 exempt. Class D beneficiaries (not otherwise classified) are taxed at 15%–16%, with no tax on transfers having an aggregate value of less than $500. Charitable institutions are exempt from tax."
Expert:  Lane replied 7 months ago.
Here's an excellent overview from NJ Dept of Treasury: http://www.state.nj.us/treasury/taxation/inheritance_over.shtml...If this HAS helped, and you DON’T have other questions … I'd appreciate a positive rating (using the faces or stars on your screen, and then clicking “submit”)…I receive no crediting at all unless you rate in this way....Thank you!Lane……I hold a law degree (JD, Juris Doctorate), with concentration in Tax Law, Estate law & Corporate law, an MBA, with specialization in finance & tax, as well as CFP® and CRPS designations. - I’ve been providing financial, Social Security/Medicare, estate, corporate, both for-profit and non-profit, and tax advice, since 1986
Expert:  Lane replied 6 months ago.
Hi,...I’m just checking back in to see how things are going...Did my answer help?...Let me know…...Thanks,Lane…
Expert:  Lane replied 6 months ago.
Hi,...Did you see my answer?...Let me know if you need more here OR if this has given you enough...Lane