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tax consequences of accepting inheritance from overseas

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jpyat

Junior Member
My question concerns a situation where a person, resident of Massachusetts, inherits a house and a monetary amount from a deceased relative who lived overseas where the inherited assets are located.

What are the tax consequences, and, from that point of view, which method of dealing with the inheritance would be preferable: selling the house and transferring the money to the US, and if and when transferring - what would be the tax obligations? Or, probably, keeping the property overseas, and what the tax obligations of the inheritor would be in that situation?

Thank you very much.
 


JH05

Junior Member
I'm in a similar situation.

A relative overseas has left me a lump sum, and as an American citizen, I'm wondering about the tax ramifications.

I can get a contact overseas to wire the money into an account here.
1) What do I tell the IRS what the source of the money is?
2) What percentage will the IRS take?
3) What happens if I don't report it? It's not a huge amount, less than six figures, and I plan to buy real estate with it. Assume it's used for a down payment on a property, can the IRS start asking questions from another angle (where did your down payment come from?) and then trace it to to a bank account wire?

Thank you for your time.
 

Snipes5

Senior Member
If it is just cash, the IRS does not care where it came from, and won't "take" any of it.

The Comptroller of the Currency, however, probably DOES care where it came from, and the bank will have you fill out forms if the amount is greater than $10,000 US.

If it is property, and you sell it, you will be subject to capital gains tax as though it were located in the US, because US citizens are taxed on worldwide income. Sale of property of course, generates income.

Snipes
 

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