I'm paying approx $800K inheritance tax in my state due to my brother in laws death. I will also be required to file a federal estate tax also since the amount is over $5.4 mil. Can I use the inheritance tax as a deduction to help lower the amount of tax I will have to pay?
SusieDarling: 1. Seek professional assistance in doing the 706.
2. See line 3b.
PS, do NOT use tro's advice. She never looks at the actual forms or instructions. Prepper World Bob is just as bad.
no, one has nothing to do with the other
when you are settling an estate, the estate pays any taxes it owes
if you inherit from the estate, you very likely are not taxed on the inheritance you receive
if your state imposes a tax on your inheritance you might claim the state tax you paid on Sch A next year, like you normally would claim state income tax paid
If you're paying $800,000 in inheritance tax, you can afford to pay my hourly fee.
Hire a tax professional or lawyer.
And what state would that be? Are YOU personally paying this tax or is his ESTATE paying it?