Is my inheritance from a Chinese relative taxable in the US?
September 15, 2006
Date: Thu, 24 Aug 2006
From: Mr. Webb
Dear Mr. Gray,
I am receiving a large inheritance from a Chinese relative who has recently passed away. The funds will be transferred to my bank account in America. What taxes will I have to pay to the American government? I was told by a lawyer in China that the taxes could be paid in China as opposed to paying to the US.
Date: Wed, 06 Sep 2006
Hello Mr. Webb,
U.S. transfer taxes are generally imposed on the transferor (the decedent's estate). Unless your relative had stock of a US company, US bonds, real estate or a business in the US, US estate tax shouldn't apply. An inheritance is not subject to US income tax, except for income received after the decedent's death.
Check with a local tax advisor about state tax consequences of your inheritance.
For answers to new questions, subscribe to our newsletter, Michael Gray, CPA's Tax & Business Insight by filling out the form below.
Home Newsletter Archive Introducing Michael Gray, CPA Articles Tax FAQ Need Help? Other Links