Everything was divided equally among the children according to their will.
There is a hierarchy to paying taxes when someone dies. The general rule is that the Trust must pay any tax liabilities. If the Trust does not pay the taxes and there are assets with which to pay the taxes, the Trustee may be personally liable. Finally, if the Trustee fails to pay, and the beneficiaries have received assets from the trust, the IRS may hold the beneficiaries responsible.
The simple rule is to pay the taxes first.
This answer does not constitute legal advice and does not and is not intended to create an attorney-client relationship. The law may vary depending on the state in which you reside. It is intended only to give some direction in which to seek assistance.
Circular 230 Disclosure: Pursuant to recently-enacted U.S. Treasury Department Regulations, I am now required to advise you that, unless otherwise expressly indicated, any federal tax advice contained in this communication, including attachments and enclosures, is not intended or written to be used, and may not be used, for the purpose of (i) avoiding tax-related penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any tax-related matters addressed herein.
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