LPT: Learned this one the hard way because never had to deal with it before. Don't touch your inheri...

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LPT: Learned this one the hard way because never had to deal with it before. Don't touch your inheritance until AFTER the taxes are paid.

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Edit by request: This is a USA problem.

Long story short, if you get any money from a dead family member, wait the full year till after you receive the tax forms to file the taxes before you start spending. If you wait, the estate gets taxed, not you. If you don't wait, that inheritance counts as income for you and moves you up in tax brackets. I know it will be hard not to touch the money, but knowing my wife and I just got hit with a $10K debt to the IRS hopefully makes you rethink touching it before the taxes are paid on it. Learn from our mistake that no one told us about.

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Accomplished_Wolf400

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Posted: 1 year ago
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