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If you got a 1099, then you owe income taxes on it. Was the full amount of your share on the 1099, or only a portion of it?

Was this annuity of your father's an investment vehicle, rather than pure life insurance? If it was a 401-K or IRA, then it's probable that it is subject to income taxes since it was tax-exempt when he contributed into it. If he was taking a portion every year, then he was probably paying taxes on the portion he received. For pure life insurance, where he paid a premium on a regular basis, that is not taxable since the premiums were paid with after-tax money.

You could consult a CPA or buy Turbotax - it should sort out everything you need to do. Uncle Sam will always take his share, it seems.

The full amount of my share was on the 1099. That was 50% of the total. It was some sort of investment vehicle. I did use about 7500 to pay on an outstanding bill of his that was due. Can I deduct paying his estate expenses? My brother needed the money immediately because he had not paid any bills during the last three months of my father's life. Dad had a 15000 credit card bill and brother and I decided to quickly get the money out of the IRA and split the cost of the bill. The rest of the estate went through probate.

If you got a 1099, then you owe income taxes on it.

This just plain isn't true. The only thing a 1099 means is you probably need to file a tax return (in case you were thinking of skipping it) and tell the IRS what that money was for. There are many situations where taxes are NOT owed on money reported on a 1099.

From some of the comments on this thread, it's apparent there are many freepers who are paying more taxes than they should. This makes me very sad.

One of the best pieces of advice I've ever had re taxes is: "If you aren't being audited every year, you're paying too much taxes." This statement is a little way out there, but the general premise is correct. Think about it.

This is not being dishonest, it's good old fashioned legal tax avoidance. The laws are in place, it's up to us to use them to our own benefit.

The person who started this thread "probably" doesn't owe taxes on the money from her father's estate, but if she insists on doing her own taxes to save $1,000 for a tax person (which is way too much for a simple tax return) it's probable she will pay a whole lot more than $1,000 in taxes that she doesn't even owe.

Folks, our job, as conservatives, is to give as little to that behemoth in Washington as possible. To even consider paying taxes in a situation like this without checking it out with a professional is beyond comprehension.