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Inheritance Tax from UK realtives

Inheritance Tax from UK realtives

Old Dec 8th 2014, 8:19 pm
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Default Inheritance Tax from UK realtives

I am due (regrettably - ) to inherit property from my Mum and Dad in the UK. Houses that will be sold to cash proceeds. Both amounts (1 from my Dads estate and 1 from my Mums) will be around equivalent to $80,000.

Hopefully a quick question that may have a multitude of answers of course but how does the IRS treat this sort of thing for tax - cash proceeds from estate in the UK . Essentially once we (My UK based brother and sister and me in the US) sort the estates out cheques will be written to me that I'll deposit in my UK bank account.

Guess I could check the IRS website but I get great advice from those with direct experience here on ex-pats forum. So again, thanks.
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Old Dec 8th 2014, 9:27 pm
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Default Re: Inheritance Tax from UK realtives

I'm sorry to hear of your loss.

The IRS does not tax inheritances. IIRC the state in which you live might, though most of not.

For completeness I should point out that the transfer(s) into the US will be reported to the IRS by your bank (amts over $10k), but there is no tax consequence to you, nor anything for you to do or report personally. ...... ETA SirEccles might have a point, below, that you might have to file an IRS reporting form if you receive over $100k. I don't recall the exact rules for that.

Last edited by Pulaski; Dec 8th 2014 at 10:54 pm.
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Old Dec 8th 2014, 9:56 pm
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Default Re: Inheritance Tax from UK realtives

You might have to report it to the IRS on form 3520 I think. But as Pulaski says it probably won't be taxed.

Misread the OP's post thought he said 80k in GBP, so you might sneak in under the $100k reporting requirement. Unless I misread it again, is that two lots of 80k?

Last edited by sir_eccles; Dec 8th 2014 at 9:59 pm.
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Old Dec 8th 2014, 11:42 pm
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Default Re: Inheritance Tax from UK realtives

State Inheritance Tax Chart - Wills and Estate Planning
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Old Dec 9th 2014, 12:43 am
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Default Re: Inheritance Tax from UK realtives

Thanks folks.
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Old Dec 10th 2014, 9:58 pm
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Default Re: Inheritance Tax from UK realtives

You'll still have to include the value on the FBAR and BOTH the estate and the cash after the estate is distributed on Form 8938 as they are two separate specified foreign financial assets.
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Old Dec 11th 2014, 12:16 pm
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Default Re: Inheritance Tax from UK realtives

Thanks again.
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Old Dec 11th 2014, 12:54 pm
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Default Re: Inheritance Tax from UK realtives

Prior to the distribution of the estate would both an FBAR and an 8938 be required? What would be required if the beneficiary was an executor? Does it matter if the beneficiary is or isn't an executor?

Last edited by nun; Dec 11th 2014 at 1:12 pm.
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