{"id":373680,"date":"2025-08-26T01:01:14","date_gmt":"2025-08-26T01:01:14","guid":{"rendered":"https:\/\/www.europesays.com\/uk\/373680\/"},"modified":"2025-08-26T01:01:14","modified_gmt":"2025-08-26T01:01:14","slug":"4-important-things-to-know-if-youre-receiving-an-inheritance","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/uk\/373680\/","title":{"rendered":"4 Important Things To Know If You\u2019re Receiving an Inheritance"},"content":{"rendered":"\n

If you just lost a loved one, you\u2019re probably focused on dealing with your loss instead of what to do with an inheritance. But at some point, you\u2019ll need to figure out a plan for the money<\/a> and\/or possessions that come your way.<\/p>\n

Read More: 3 Reasons Retired Boomers Shouldn\u2019t Give Their Kids a Living Inheritance<\/a><\/strong><\/p>\n

Check Out: 6 Big Shakeups Coming to Social Security in 2025<\/a><\/strong><\/p>\n

If you are receiving an inheritance, here are four important things to know<\/a>.<\/p>\n

One thing to know is that an inheritance probably won\u2019t include cash. The more likely scenario is that you\u2019ll be named a beneficiary of a retirement account or inherit a family home, according to Jason Albano, a managing director and wealth strategies advisor with Bank of America Private Bank who shared his expertise in a Merrill<\/a> blog.<\/p>\n

Albano explained that you may have up to 10 years to liquidate a tax-deferred account<\/a>, such as an IRA or a 401(k), that you\u2019ve inherited. However, this could be dependent upon your age and other factors.<\/p>\n

Learn More: The Estate Planning Secret the IRS Doesn\u2019t Want You To Know, According To John Liang<\/a><\/strong><\/p>\n

An inheritance \u201cgenerally isn\u2019t considered income\u201d for federal income tax purposes, according to Merrill. However, there are some exceptions. Depending on your location, you might also be charged a state inheritance tax<\/a>.<\/p>\n

What usually happens is that the estate will pay the estate taxes. After that, beneficiaries will receive the assets, which are free from income taxes. But if a beneficiary later sells or earns income from inherited assets, they could face income taxes, Merrill noted.<\/p>\n<\/p>\n

On the other hand, if a beneficiary receives certain tax-deferred accounts, such as a traditional IRA or 401(k), they will be responsible for paying the usual taxes on withdrawals. That includes taxes on required minimum distributions<\/a>.<\/p>\n

And you\u2019ll want to be aware of any assets that offer income, as that could change your tax bracket and impact your taxes, Merrill explained.<\/p>\n

Hiring a financial advisor<\/a> and\/or a tax professional is always a good idea when you receive an inheritance \u2014 but it\u2019s especially important with large inheritances that involve a lot of money or assets.<\/p>\n

As Charles Schwab<\/a> noted, a financial advisor can review your overall financial picture and recommend the right investment vehicles. Meanwhile, a tax advisor can help explain the tax implications of your inheritance.<\/p>\n

Regardless of what kind of inheritance you receive, it\u2019s a good idea to not rush into decisions that involve spending the money or selling off assets. Fidelity<\/a> recommended not making major decisions within the first year of getting the inheritance.<\/p>\n","protected":false},"excerpt":{"rendered":"If you just lost a loved one, you\u2019re probably focused on dealing with your loss instead of what…\n","protected":false},"author":2,"featured_media":373681,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3093],"tags":[51,130711,474,3121,130712,2499,29925,16,15],"class_list":{"0":"post-373680","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-personal-finance","8":"tag-business","9":"tag-federal-income-tax-purposes","10":"tag-finance","11":"tag-inheritance-tax","12":"tag-jason-albano","13":"tag-personal-finance","14":"tag-retirement-account","15":"tag-uk","16":"tag-united-kingdom"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@uk\/115092369160664533","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/373680","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/comments?post=373680"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/373680\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media\/373681"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media?parent=373680"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/categories?post=373680"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/tags?post=373680"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}