ANSWERS: 1
  • Generally the child will not pay federal taxes on the inheritance. And depending on the state(s), you probably wouldn't own them taxes either. Generally, if the state uses the information from the federal 1040 form, they generally don't tax what the federal government doesn't tax. Talk to a tax advisor in your state and they can confirm this for you. IRS Pub: http://www.irs.gov/pub/irs-pdf/p950.pdf

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