Tax Considerations for Inherited Wealth Management

As a private wealth manager, you are working with a high-net-worth client, Carol, who is 45 years old and recently inherited a significant sum of money. She has a diverse investment portfolio but is concerned about the tax implications of her recent inheritance. Carol resides in a high-tax state and is particularly interested in understanding how her investment decisions can be managed to minimize her tax burden while maximizing her wealth accumulation over the long term.

Discuss the key tax considerations Carol should keep in mind regarding her investment strategy, including any potential tax-efficient investment vehicles, strategies for managing capital gains, and understanding the implications of her state tax obligations. Additionally, provide insights into the potential impact of her inheritance on her overall financial planning.