Hi Money Minder,
So, my dad passed away in 2018, and I recently received a check for almost $100K after all the probate drama. Do I have to pay taxes on this money? I live in California, and I’m also worried about how it might affect my health insurance. Any advice would be awesome. Thanks in advance!
Farewell from Curious Californian,
Response from THE MONEY MINDER:
Hello There,
I am truly sorry to hear about the loss of your dad and the difficult situation surrounding his illness and passing. It’s understandable that receiving unexpected money after such a trying time can bring up questions and concerns. In regards to whether you need to pay taxes on the check you received, generally, inheritances are not considered taxable income for federal tax purposes in the United States. So, in most cases, you would not have to pay income tax on the inheritance you received.
However, it is always a good idea to consult with a tax professional or accountant, especially in California where state tax laws may differ. They can provide you with personalized guidance based on your specific situation and ensure that you are meeting all tax obligations.
As for how this inheritance might affect your health insurance, receiving a one-time inheritance likely won’t affect your eligibility for coverage since it’s not considered regular income. However, if you are concerned, it’s worth checking with your insurance provider or a financial advisor to confirm any potential impacts on your health insurance premiums based on income changes.
Ultimately, seeking professional advice is the best course of action to ensure that you are making informed decisions and addressing any potential implications of receiving this inheritance. I hope this information helps ease some of your concerns, and if you have any more questions or need further assistance, feel free to reach out for support.
THE MONEY MINDER
