Are gifts, bequests, or inheritances taxable?
A. Generally, property you receive as a gift, bequest, or inheritance is not included in your income. However, if property you receive this way later produces income such as interest, dividends, or rentals, that income is taxable to you. For additional information, refer to Chapter 13 of Publication 17, Your Federal Income Tax. If you inherited an Individual Retirement Arrangement (IRA), special rules apply. Refer to Publication 590, Individual Retirement Arrangements (IRAs), for further information.
