There is no upper limit to what you can inherited. However, the federal government will impose an estate tax. Estate tax exemption is currently about $13.61 million. This exemption can double for a couple, but the surviving spouse need to file for portability of the exemption within 2 years of the death to preserve the exemption. Your state may impose a different set of estate or inheritance tax.
One issue is that the exemption supposedly sunset in 2026, so that the exemption drops to around $5-6 million. No one knows if it will sunset or if the government will preserve the exemption. Assuming that the sunset do occur, there may be an opportunity to reduce estate tax by giving he money away to the heir before the exemption expires. A person can only give $18K per person, if you give more than $18K, it starts eating into the exemption, but you might be able to save estate tax by giving enough away to reduce the estate before it sunsets. The exemption you used up might expire any way.
If your parent have that much money, you should definitely hire an estate lawyer because this part is complicated and unless the boglehead member is an estate lawyer, they won't know either (note: I am not an estate lawyer).
This is not really an Roth ira question. You will hit the federal estate tax if the money is in taxable, roth, or traditional ira. The plus with Roth is that the money is tax free and even if you have to withdraw it within 10 years, it's still tax free.
One issue is that the exemption supposedly sunset in 2026, so that the exemption drops to around $5-6 million. No one knows if it will sunset or if the government will preserve the exemption. Assuming that the sunset do occur, there may be an opportunity to reduce estate tax by giving he money away to the heir before the exemption expires. A person can only give $18K per person, if you give more than $18K, it starts eating into the exemption, but you might be able to save estate tax by giving enough away to reduce the estate before it sunsets. The exemption you used up might expire any way.
If your parent have that much money, you should definitely hire an estate lawyer because this part is complicated and unless the boglehead member is an estate lawyer, they won't know either (note: I am not an estate lawyer).
This is not really an Roth ira question. You will hit the federal estate tax if the money is in taxable, roth, or traditional ira. The plus with Roth is that the money is tax free and even if you have to withdraw it within 10 years, it's still tax free.
Statistics: Posted by gavinsiu — Tue Jul 09, 2024 11:04 pm