A little confused...

ufhopeful24
Tue, 29 Mar 2011 01:39:10 +0000

In a few months, I am receiving what I guess would be considered an inheritance - someone in my family died and left me money when I was much younger, and a financial adviser at Edward Jones has been taking care of it ever since then. I don’t know everything about the account, but I know there are stocks involved with it (as in, I think I own some stocks and the amount of money in the account goes up or down each month depending on how the market is doing). I’m not sure of how everything works (and I am not sure my mother does either), but my mother is advising me to not take the money out of the account when it is time, and to leave it in there for another year or so because she is concerned it will affect our FAFSA. She thinks that we will have to pay taxes on it, and then report it as income on our FAFSA. It is not a large sum of money - it would be around $10,000 by the time I took it out. Basically, my question is, is my mother correct? Would we have to report it as income on the FAFSA next year? Do I really have to pay taxes on it? It is a gift, and I thought the gift tax was for something like $13,000 or more. And would it negatively effect our EFC? I receive a Pell Grant now, and both subsidized and unsubsidized loans, and I would not want to lose those. Thanks in advance for any advice you all may have, and I’m sorry I don’t have more information regarding the type of account.