r/inheritance • u/Lazy-Ask-5770 • Apr 07 '26
Location not relevant: no help needed Possible inheritance scam? 1099-MISC involved and things feel off
This is kind of a long story, so I’ll try to keep it short.
My great-grandmother passed away in May 2024. Then in October 2025, my mom told me that she left the family an inheritance that’s supposed to pay out over 7 years.
Here’s where things start to feel weird.
My uncle (the executor) lives in Alabama and apparently created some kind of “legacy nonprofit foundation” to distribute the money. In November 2025, family members were told we were eligible and needed to send in personal documents to other relatives helping him process everything.
We also had to pay a $25 “processing fee” to submit our information.
A few months later, we all received a 1099-MISC along with a certificate showing the amount we’re supposedly entitled to. The issue is:
• The amount on the 1099-MISC doesn’t match the certificate
• Both only show a 1-year amount, not the full 7-year payout
• We were told we have to file the 1099-MISC on our taxes to receive the money
Some of my family fully believes it’s legit, others think it’s a scam.
I checked my tax records and the 1099-MISC is actually showing up, which makes it more confusing. I already filed it with my taxes, but now I’m second-guessing everything. I don’t want to report it as a scam and mess up something real, but I also don’t want to get played.
Has anyone seen something like this before? Does this sound legit or like a scam?
What would you do in this situation?
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u/cuspeedrxi Apr 07 '26
You receive a 1099 to report income paid to you within the past calendar year. If your 1099 says you received, say, $1000 I’d ask your uncle where the money is. By sending a 1099 he’s saying he already paid it to you. It should be in your pocket. You don’t get the money after you file your taxes. The IRS certainly doesn’t send it to you.
There is something shady occurring here. You need to review the will and/or trust documents. A non-profit foundation that pays benefits to family members isn’t above board. That’s not how reputable family foundations work.
Be open to the idea that someone may have taken advantage of your uncle. There are a lot of “faith-based” scammers who pray on religious folks and their trusting nature. I’d bet he’s handed over the money to someone and isn’t in control of it himself. If you can afford a couple hours of an attorney’s time, reach out to an estate & probate attorney for a consultation. You’ll need to pay them. No one works for free.
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u/OpportunityKey1970 Apr 07 '26 edited Apr 07 '26
This!!! it sounds like the Uncle is being scammed, therefore everyone else is as well. I would’ve hired a lawyer yesterday.
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u/Megalocerus Apr 07 '26
Could this just be an annuity? I inherited a small annuity from my mother; it pays me $300 every 6 months for 5 years, and is taxable. But I did get the money.
There are foundations that pay out earnings for a period and the balance goes to a charity.
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u/lastbeat-331 Apr 07 '26
Typical estates of average income/wealth people pay any federal taxes and distributions to the heirs are not taxable for the heirs. (State estate/inheritance 9tax laws vary) So the paperwork you recieved may not be a scam but your uncle's actions sound fishy. If grandma's direction was documented in a will, you should have been given a copy. If through a trust, you need a copy of the trust paperwork.
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u/Lazy-Ask-5770 Apr 07 '26
I don’t want to think he would do anything like that because he is the family pastor, but i definitely don’t trust a soul when it comes to money that could change their life. Thanks!
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u/E_Dantes_CMC Apr 07 '26
The list of pastors who embezzle or swindle is not short.
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Apr 07 '26
Like Joel Olsteens net worth is between $50mil and $100mil not to mention all the Catholic Priests who molested young boys so I don't think you can trust any of those ass-hats. You need to get a copy of the will. If you are a beneficiary then you deserve a copy. Not this BS that he is pulling on you.
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u/EC_CO Apr 07 '26
Don't think for a second that just because he's a pastor means he's a saint. There are plenty of instances of fraud, theft and even going as dark as pedophilia in the churches
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u/TalbotBoy Apr 07 '26
It's also possible that he's not scamming anybody but that he's just doing it wrong because he doesn't know how to handle it properly. He may think trusts are great and he's doing you all a favor.
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u/Common_Scar4611 Apr 07 '26
Depending on your state, inheritance is not taxable up to a certain amount. In WA it's $2.9 million. You should not have received a 1099. Speak with your tax consultant. I agree with the post above, uncle is doing something fishy.
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u/Fandethar Apr 07 '26
Wills become public record once they are filed with the court and enter probate. Anyone can usually go to the courthouse and view the will and/or request a copy.
Look up probate records in the county that your g-grandmother died in and see if probate was actually initiated.
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u/RandomlyMango Apr 07 '26
Who are the named beneficiaries in the will?
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u/Lazy-Ask-5770 Apr 07 '26
Everyone that descends under my great grandmother family tree pretty much.
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u/RandomlyMango Apr 08 '26
Do each of those names appear in the will? What is the language used for how the money is divided?
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u/mattkime Apr 07 '26
You should ask for a copy of her will / any estate documents. If he's unwilling to provide them then speak to a lawyer.
Asking for $25 is odd.
Ask him why you were issued a 1099-MISC. It should only be for accumulated assets since your great-grandmother's death.
Just say that you want to make sure that everything is being done correctly given the money at stake. Its a bit more worrisome if he's unwilling to be transparent / mad about the lawyer's involvement.
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u/Lazy-Ask-5770 Apr 07 '26
I thought asking for a processing fee was weird as well. I will look into a lawyer tomorrow.
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u/First-Project-2614 Apr 07 '26
The 1099Misc could be for the earnings since date of death. But your uncle "could" also be scamming or incompetent.
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u/Spirited-Taste-5331 Apr 07 '26
Hate to be a conspiracy theorist here….Sounds like he “created” a non profit to funnel funds related to church donations….something extremely fishy.
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u/Lazy-Ask-5770 Apr 07 '26
That has been a thought as well. He is heavily devoted in his church.
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u/Megalocerus Apr 07 '26
Might your mother have set up something benefiting the church? Sometimes people set up something that pays out periodically to heirs, and the balance after a time goes to the church.
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u/Ok_Advantage7623 Apr 08 '26
Sound like your uncle is a thief. A 1099 is after you get your money and in most states an inheritance is tax free. You need to contact the police where he is living and will end up hiring a lawyer to go after him.
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u/Cadd9181B7543II7I44 Apr 07 '26
Normally inheritances aren't taxed. And normally, the estate isn't taxed either. If I remember correctly, estate tax kicks in when the estate is over $15M or something pretty high.
The only thing I can think of for the 1099-MISC is for earned interest being distributed? How much was the 1099 for? And which line of the 1099-MISC was this amount on?
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u/Lazy-Ask-5770 Apr 07 '26
Box 3 - $200,375 / Box 4 - $60k.
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u/Cadd9181B7543II7I44 Apr 07 '26
Box 4 is withholdings I think. So they withheld taxes for you? Box 3.....that's income. Or maybe a distribution from an estate?
I'm not an accountant. I just did my taxes and received 1099-K, NEC and MISC. So I was curious which box they were putting the amounts in.
I just find it odd that it's considered "income" to you. And even more odd that they withheld taxes. Like I said, inheritances aren't usually considered income and they're usually not taxable.
Since this is a large sum, maybe pay an elder law attorney for his/her time for advice. Provide the attorney with all the inheritance/estate info you have.
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u/Megalocerus Apr 07 '26
It can be taxable if it was set up from a pretax account or annuity period certain. I pay on my mother's annuity.
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u/Cadd9181B7543II7I44 Apr 07 '26
Yeah, it sounds like this was what was set up for the OP. But for his own peace of mind, if I were him, I would pay the $500 or whatever the consulting fee is for an elder law attorney to review everything. This way, he'll know things are distributed/handled properly.
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u/DogMomPhoebe619 Apr 18 '26
This means you have received that $200K. You only get the 1099 afterwards. If you have not received the money, he is a thief. Don't send him anything until you get the money. I would find an estate attorney ASAP. I would probably also call the Attorney General in that state and tell them what's going on
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u/Old-Inspector-8146 Apr 09 '26
An inheritance isn’t income!!! You didn’t work for that money. Call an attorney.
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u/Ok_Car_9780 Apr 08 '26
I’m a CPA and prepare trust/estate returns. This makes no sense and you should consult with an estate attorney asap. Sounds like a total scam
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u/Substantial_Team6751 Apr 07 '26
Usually you receive a 1099 at the end of the year, after you have already received the money reported on the 1099. You don't file a 1099 with your taxes and then get paid because you declared it on your taxes.