12 azbankers.org By Frank Schoen, Bankers Trust 3 Key Steps To Take Upon Receiving An Inheritance Beyond consulting with your tax advisor, an heir should confirm that the grantor/testator’s final tax obligations have been satisfied. By being proactive, you can avoid the uncomfortable situation of needing to return part of an inheritance to cover the grantor/testator’s final income tax or estate tax obligations. It happens more often than you might think. As the largest and wealthiest generation of Americans prepares to retire, as much as $68 trillion will be passed down to younger generations over the next two decades. This phenomenon, dubbed “The Great Wealth Transfer,” is already beginning today. Whether expected or unexpected, if you receive an inheritance, do you know what to do on day one? Planning reduces the risk of not using the money efficiently and helps remove emotion from the process. Read on for three critical steps for heirs to take when receiving an inheritance. 1. Discretion is key Remember that receiving an inheritance is no business but your own as an heir. It is usually in your best interest to keep the matter as private as possible. Think about lottery winners whose winnings make the local news. Often, the lucky winners find themselves inundated with cash requests from friends, family, neighbors, co-workers, old classmates and perfect strangers. Making rational decisions with money is hard enough without a public audience. Keeping the news between you and your spouse or partner can help reduce external influences around financial decisions involving your inheritance.
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