Taxes from Inheriting property via irrevocable trust
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Taxes from Inheriting property via irrevocable trust
My father, a widower, recently passed. He set up an irrevocable Trust and transferred his home into the Trust in order for my mother to qualify for Medicaid when she was put into a nursing home. She passed last year. I am the trustee of the trust and the sole beneficiary. Will I be liable for any taxes (federal, state, inheritance or estate) when I sell the property? He was a resident of PA and I live in NJ.
Asked on October 20, 2019 under Estate Planning, New Jersey
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 4 years ago | Contributor
When ever you, as trustee, take the money out of the trust and distribute it to you, as beneficiary, you be taxed on it as if you received it at that time. Before then, while the house (pre-selling) or money from the house (post-selling) is in the trust, it is not yours and you will not be taxed on it.
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