John Baker wrote:

- quote -

No taxes will be due if it is an inheritance from the estate
of the aunt. If the amount any child receives exceeds
$100,000, however, the child must file Form 3520 with the
IRS disclosing the inheritance.

Also note that if the amouint that your children are
receiving is coming from a foreign trust rather than the
estate of the aunt, then some more complex rules kick in,
and the amount received by the children could be hit by some
fairly severe income taxes.

--Chris Ballard

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- quote -

No. But once they have the money, any income generated from
investing it, i.e. interest, dividends, or capital gains, is
taxable.

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== >

johnhbaker[at]comcast.net (John=A0Baker) asked:

- quote -

No. Neither an inheritance nor a gift is taxable to the
recipient. The aunt's estate may have had a tax bill, but
that was the executor's problem, and not the beneficiary's.

Btw, the IRS will require a return for any income earned
from the inherited assets -- e.g., if deposited into a CD,
the interest earned will be income. Ditto with dividends if
it's stock which is inherited.

Depending on age (under 14), that can be reported on the
parent's return.

Bill

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== >

My children are inheriting some money from an Aunt in the
UK. My question is simply: do they have to pay US income
taxes on it?

Thanks

John Baker

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== >