Why Do I Have To Pay Inheritance Tax?
If you are lucky enough to receive a decent sized inheritance there is a good chance that the government will want to tax you. It may not seem fair that they will profit off of property handed down to you that has already been taxed many times before, but they still want to get their share. Basically you have to pay inheritance tax because the government wants to make a profit off of you every way possible. There may however be ways to use this as a deduction in and of itself.
When Do You Have To Pay The Tax
If it is a large sum of money that you are receiving, and it isn’t in a protected trust, you may have to pay taxes on it before you even have it in your account. Usually there is an attorney involved with such things and they will be able to help you meet your tax obligations right away. They can also advise you about ways to avoid such taxes in the future, so while you have to pay inheritance tax, it doesn’t have to be a large amount.
When Don’t You Have To Pay Inheritance Tax?
If your relative or other person allocating their resources to you created a trust of some sort, the inheritance may actually be tax exempt. Again, an attorney will be able to assist you with this. If you are considering setting up a will or doing estate planning you should look into the methods available that will help you lower taxes. There are a variety of different ways to do this for all types of assets, including physical properties like houses.