Most people are familiar with estate taxes—taxes levied by either the federal government or the states (or both) on estates before disbursement to heirs. State estate taxes tend to have a negligible impact on most estates, because they can be taken as a credit against federal estate taxes.
However, six states—Iowa, Kentucky, Maryland, Nebraska, New Jersey and Pennsylvania— also levy inheritance taxes, which certain heirs must pay on their proceeds. Inheritance taxes run between 4% and 18% (with possible exemptions), payable by heirs unless they are qualifying relatives in the state (and sometimes charities).
Since Georgia doesn’t levy this tax, why should someone living (and presumably dying) in Georgia worry about them?
If you own assets in any of these six states, you may need to consider inheritance taxes in your plans.
For a comprehensive review of how inheritance taxes could impact your estate planning, please contact Scarlett Ollila to schedule an appointment to meet with one of our attorneys.