Reply to Question about safe deposit box at bank

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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]You don't have to but the bank must report that you have a safety deposit box to the IRS. This is a relatively new rule so beware.[/quote]

What purpose does this serve? The bank reporting the box to the IRS... Is it so that the IRS can come after what's in the box after you die?[/quote]

Or beforehand if they suspect that you are up to something or underreporting (or you're just an unlucky randomized audit). [/quote]

and needless to say: so that the IRS can make sure to collect the inheritance tax from your inheritors, plus fines and interest, if they "forget" to pay the tax.[/quote]

So for posessions like jewelry, for example. How can the IRS make sure you pay an inheritance tax on this? Are they going to have a representative there when you open the box and inspect the contects? I don't get how the inheritance tax can be enforced on a safe deposit box and its contents as pp suggests?[/quote]

Speak to a tax expert. I *think* that the inheritor will not have to pay estate tax but they may have to pay long-term capital gains. [/quote]

Nooooooo. There still exists a stepped-up basis for inherited assets. The estate itself pays any tax due. There are no capital gains taxes involved.[/quote]

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