Received an Inheritance? Who to Call for Financial, Tax and Legal Help, and What to Do First
Receiving an inheritance often arrives alongside grief, family logistics, and a stack of unfamiliar paperwork. It is common to feel pressure to decide quickly. In most cases, the better approach is the opposite: slow down, get organized, and bring in the right people. If you are wondering, after an inheritance, who to call for financial, tax, and legal help, this guide walks through the roles, the order of operations, and the decisions that usually come first.
An inheritance is both a wealth event and a tax event. How assets are titled, which accounts they sit in, and when you take action can affect what you keep and how the money supports your goals for years to come.
Start Here: A Complimentary Inheritance Wealth and Tax Review
Before moving money or making changes, it helps to see the full picture. Compound offers a complimentary, no-obligation wealth and tax review for people who have received or expect an inheritance. It may include:
An inventory of inherited assets: retirement accounts, brokerage accounts, real estate, business interests, and cash
Tax considerations: cost basis, required distributions from inherited retirement accounts, and timing
Integration with your plan: how the inheritance fits with your existing investments and goals
Coordination: questions to bring to the estate attorney and executor
Request your inheritance review.
Inheritance: Who to Call First
Different professionals handle different parts of an estate. Knowing who does what can save time and prevent mistakes.
The executor or trustee. This person manages the estate or trust and distributes assets. If you are the beneficiary but not the executor, they are your first point of contact for timing and paperwork.
An estate attorney. An attorney can explain probate, trust administration, and your rights as a beneficiary. Legal questions should always be coordinated with an estate attorney.
A CPA or tax professional. Final income tax returns for the person who passed, estate or trust tax returns, and your own return may all be affected.
A fiduciary financial advisor. An advisor can help you decide how inherited assets fit into your broader investment plan and how to handle inherited accounts.
Account custodians and insurers. Banks, brokerages, retirement plan administrators, and life insurance companies each have their own claim processes.
When your financial advisor and tax professional work at the same firm, those conversations can happen together. For more on finding the right help, see who to call when you need help managing money in Wisconsin.
What to Do With an Inheritance: The First 90 Days
A practical sequence for what to do with an inheritance:
Pause on big decisions. Park cash proceeds in a safe, liquid account while you plan. There is rarely a reason to invest, spend, or gift a large sum immediately.
Gather documents. Collect death certificates, the will or trust, account statements, beneficiary forms, deeds, and recent tax returns.
Identify how each asset passes. Assets with beneficiary designations, such as IRAs and life insurance, usually pass outside the will. Others may go through probate or a trust.
Understand cost basis. Many inherited assets held in taxable accounts receive an adjustment in cost basis to fair market value at the date of death, often called a step-up. This can reduce capital gains if the asset is sold, so documenting values is important.
Review your own plan. An inheritance may change your retirement timeline, debt strategy, charitable goals, or estate plan.
Inherited IRA Rules: What Beneficiaries Should Know
Inherited IRA rules have changed in recent years and can be easy to get wrong. At a high level:
Spouses generally have the most flexibility, including the option to treat an inherited IRA as their own in many cases.
Many non-spouse beneficiaries must withdraw the full balance within ten years of the original owner's death. Depending on whether the original owner had already begun required distributions, annual withdrawals during that period may also be required.
Certain eligible beneficiaries, such as minor children of the account owner, disabled or chronically ill individuals, and beneficiaries not more than ten years younger than the owner, may qualify for different distribution options.
Inherited Roth IRAs are generally subject to distribution timing rules too, though qualified withdrawals are typically tax-free.
Withdrawals from inherited traditional IRAs are generally taxed as ordinary income. Spreading distributions across several years, rather than taking a large lump sum, may help manage taxes, especially for beneficiaries in their peak earning years. Because rules are detailed and penalties can apply for missed distributions, this is an area for coordinated tax planning and preparation.
Inherited Real Estate and Family Businesses
Inherited property raises its own questions: keep, rent, or sell; how to divide it among siblings; and how depreciation and basis work going forward. Our guide to real estate family tax strategy covers many of these points. Inherited business interests may require valuation and decisions about management or sale.
Putting the Inheritance to Work
Once the estate is settled and taxes are understood, the inheritance can be integrated into your wealth management plan. That may mean paying down debt, filling an emergency reserve, funding retirement accounts, or investing for long-term goals. The Compound calculator can show how a hypothetical inherited amount may grow over time under different assumptions. Results are hypothetical, but they can make long-term tradeoffs easier to compare.
Many families also inherit the parent's advisor relationship. Our article on working with a parent's advisor discusses what to consider. For larger or multigenerational estates, family office wealth management can help coordinate investments, taxes, and legacy planning with your estate attorney.
How Compound Helps
Compound brings wealth management, investment management, and tax planning together, so inherited accounts, tax filings, and investment decisions are handled in one coordinated plan. We serve families throughout Wisconsin, including Milwaukee, Madison, Kenosha, Racine, Green Bay, and Wausau, as well as surrounding areas. Wisconsin does not currently impose a state estate or inheritance tax, but federal rules and other states' laws may apply depending on the estate.
Recently received an inheritance? Request a complimentary inheritance wealth and tax review.
Frequently Asked Questions
After an inheritance, who should I call first for financial help?
Start with the executor or trustee to understand timing, then involve an estate attorney, a tax professional, and a fiduciary financial advisor. Coordinating these roles early can help avoid costly mistakes.
What should I do with an inheritance right away?
Usually very little. Keep cash in a safe, liquid account, gather documents, and build a plan before investing, spending, or gifting large amounts.
What are the inherited IRA rules for non-spouse beneficiaries?
Many non-spouse beneficiaries must empty an inherited IRA within ten years, and some must also take annual distributions. Certain eligible beneficiaries have other options. Confirm your situation with a tax professional.
Do I pay taxes on an inheritance?
Wisconsin does not currently have an inheritance tax, but income tax may apply to distributions from inherited retirement accounts, and capital gains may apply when inherited assets are sold.
Should I keep my parent's financial advisor?
It is worth meeting with them, but evaluate the relationship as you would any advisor: fiduciary status, services, fees, and fit with your own goals.
Compound is a registered investment adviser. Registration does not imply a certain level of skill or training. This article is for informational and educational purposes only and should not be construed as personalized investment, tax, or legal advice. Compound does not provide legal advice; please coordinate estate and probate matters with an estate attorney. Tax laws, including rules for inherited retirement accounts, are complex and subject to change. Strategies discussed may not be suitable for everyone, and there is no guarantee that any strategy will achieve its objectives or reduce taxes. Calculator results are hypothetical, are not guarantees of future results, and do not reflect any actual investment. Investing involves risk, including possible loss of principal. Please consult your tax, legal, and financial professionals before acting on any information in this article. For more information, see Compound's Form ADV, available at adviserinfo.sec.gov.
About Compound Wealth
Many financial decisions involve more than one area of expertise. Compound Wealth provides integrated tax planning, wealth management, accounting, and business transition services so clients can evaluate financial decisions within a broader planning framework. This collaborative approach supports thoughtful conversations across multiple areas of financial life.
