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I am a Green Card resident in Nebraska USA, and I am a UK citizen. Is it correct that I need to report to the USA Government if I inherit more than $10,000 from my father’s Will (he too was a UK citizen)? I have reported it to HMRC and because the inheritance is under the threshold, there are no taxes due in the UK.

I’m not sure if I’m reading Google correctly, but it appears that I would not be liable to pay US tax on this inheritance – however, it appears that some states (including Nebraska) do regard any inheritance as taxable at 18%.

Could anyone please help clarify this for me? This is so confusing!

Do I need to file the forms FBAR and 3520?

Very many thanks for any advice or information.

  • If your inheritance includes cash/securities totaling 10,000USD (equivalent) or more and you leave it in an overseas account then you will have to file an FBAR. There are penalties if you are found to have not filed an FBAR when you were supposed to. But this doesn't necessarily mean you will owe taxes on any portion of the amount reported. That is determined separately and there are a number of factors involved (total amount inherited, where you live, etc.) – CactusCake Jul 23 '18 at 22:07
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I am not a lawyer (IANAL) but the US (Federal) government exempts the first half million (+/- $250k). That's why you don't owe the Feds.

States can tax you separately. (+counties, +cities/towns/etc.)
The percentage you are taxed on might be after an exemption (I see an exemption on the first $40k).

Check with a tax CPA in Nebraska, you may have options since it is from out of the country (like not realizing it until you convert it to dollars, or until you bring it to the US).

Also, for what it is worth, I don't see your 18% figure anywhere.
I see a 1% rate in NE for a child after your $40k exemption.
Ref: nolo.com/.../nebraska inheritance tax

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