Legal Question in Wills and Trusts in Indiana
Do we pay taxes on inheritance?
My wife and I recently inherited a house from my wife's elderly baby sitter in Indiana. The house is located in Indiana. We are residents of Wisconsin and for the last 9 months of her life the babysitter was in our house and then in a nursing home here in Wisconsin. We are now in the process of selling the house. Upon it's sale would we owe any Indiana Inheritance Tax?
1 Answer from Attorneys
Re: Do we pay taxes on inheritance?
"Inherited" should be considered a term of art for purposes of Indiana Inheritance Tax. The short answer is: if the Indiana house came to you by a testamentary instrument (will or trust) or even by a deed made in contemplation of death, then there probably will be inheritance tax due on the "inheritance." If the house is in a probate case in Indiana, your attorney can file the form IH-6. If you file and pay the taxes within nine months of the date of death, you are entitled to a 5% 'discount'. (I look at it as a 5%+ penalty for failing to file and pay within nine months.)
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