Legal Question in Tax Law in California

Re: Taxes and Inheritance

IRA's are subject to both income and estate tax. Estate tax to the extent that it is part of the deceased estate at death, and if the estate was worth over 2 million (or they had utilized a portion of the gift tax exemption)... then the IRAs are subject to tax.

Income tax will be paid when you get distributions from the IRA. Anything over the basis (the original amount put in) is taxable.

So yes, you probably have to pay taxes. Talk to a CPA to find out exactly how much.