Is it legal to deposit a large cash inheritance — say, $150,000 — into a bank? The money is not currently in a bank account and it is not part of an estate — let’s assume it’s just cash in an envelope — and I live in a state with no inheritance tax. I assume I can make this deposit legally and that there will be no tax consequences. Am I correct? Must I provide a recent death certificate?

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Will the bank get suspicious if I deposit $150,000 in cash into my checking account?

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I don’t know why or how this money was withdrawn from a bank and put in an envelope — and I’m not sure I want to know.

In any case, depositing more than $10,000 into your bank account will likely trigger a mandatory currency-transaction report to both the Internal Revenue Service and the Financial Crimes Enforcement Network under the Bank Secrecy Act of 1970. This is standard procedure to detect potential money laundering. It does not mean that you have done anything wrong, so as long as you haven’t — well — done anything wrong, it should not create a problem for you. But there should be a paper trail in case you are audited.

What if you were to deposit this money in $10,000 increments to avoid triggering an alert? Deliberately breaking up financial transactions to avoid triggering reports that are required by law is called “structuring,” and it’s illegal. The authorities can spot structured transactions during a Bank Secrecy Act audit, a Form 8300 review or an income-tax audit. While there are similarities between transactions designed to avoid different reporting requirements, investigators will look at them with a magnifying glass.

You could be asked for probate documents, a letter from the executor or a death certificate to confirm this cash is from a legal source. However, that would be less likely if the cash was already legally yours and was not being transferred directly from a deceased person’s account. In most other cases, you would be required to submit a certified copy of a death certificate to a financial institution in order to transfer or deposit inherited funds into your account. Banks use these official documents to confirm an individual’s death.

Only a handful of states levy an inheritance tax — Kentucky, Maryland, Nebraska, New Jersey and Pennsylvania — and the amount owed typically depends on the heir’s relationship to the deceased. While there is no federal inheritance tax, the IRS does impose a federal estate tax, and the exemption threshold is adjusted annually for inflation. For 2026, estates generally must file and potentially pay federal estate tax only if their taxable value exceeds $15 million, up from $13.99 million in 2025.

An inheritance tax is paid by the recipient, and the amount typically depends on the heir’s relationship to the deceased. By contrast, an estate tax is paid by the estate itself before any assets are distributed, although any interest or investment earnings generated after you receive it would be taxable. This includes the federal estate tax administered by the IRS. In other words, beneficiaries generally do not directly pay federal estate tax; it is settled by the estate prior to distribution. (Read more here.)

If you don’t need this money, TurboTax suggests putting it into a trust. “A trust allows you to pass assets to beneficiaries after your death without having to go through probate,” it notes. “Trusts are similar to wills, but trusts generally avoid state probate requirements and the associated expenses that wills typically have to go through. With a revocable trust, the grantor can take the assets out if necessary. An irrevocable trust usually ties up the assets until the grantor dies.”

Bottom line: When you deposit a large cash amount — in this case, a $150,000 inheritance — the bank teller verifies your identity, records your explanation of the money’s source and processes the deposit normally. The transaction is then reviewed by automated monitoring systems, and if something seems inconsistent, the bank might request documentation like estate paperwork. As for this $150,000: It’s better off in your bank account than in a drawer. Follow the rules and you won’t — fingers crossed — experience any problems.

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Previous columns by Quentin Fottrell:

‘The house has quadrupled in value’: I bought a house with my brother, but he did not contribute. How do I fix this?

My sister is buying our parents’ $3 million house, but wants to deduct $100K for renovations. Who’s right?

‘I’m simply exhausted’: I’m 55 and have $1.3 million for retirement. Can I retire next year?

‘I spend $7,500 a month’: I’m 47, earn $260K, and have $3 million. Can I retire at 50?

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