inheritance tax

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Related to Death duties: inheritance tax

Inheritance Tax

A tax on the money or assets that one inherits from an estate, as opposed to a tax on the estate itself. In the United States, inheritance taxes are levied at the state level and apply to the inheritors rather than the estate of the deceased. Generally speaking, inheritance taxes vary according to the inheritor's relationship with the deceased. For example, a spouse rarely, if ever, is responsible for an inheritance tax. It should not be confused with an estate tax, which is a tax on the estate before it is distributed.

inheritance tax

A state tax levied on the recipient of an estate rather than on the estate itself. The tax varies by state and its severity in a given state usually depends on the kinship between the deceased and the heir. Some states levy a tax on the estate instead of a tax on the amount inherited. Also called death tax. Compare estate tax.
How can I minimize inheritance tax?

Estate and gift tax law is in a state of flux. An estate planning attorney will have the most up-to-date information available to assist you in minimizing your tax liability. Avoiding probate should also be a goal. Joint ownership, revocable living trust, irrevocable trusts, and life insurance may be useful tools to avoid or eliminate the estate tax and costs of probate, but only an experienced estate planning attorney can help you decide which of these tools will suit your needs best.

Gloria Cole, Attorney, private practice, Weston, MA

inheritance tax

a form of WEALTH TAX imposed by the UK government on a proportion of a person's private assets when these assets are transferred to the person's beneficiaries. Currently (as at 2005/06) ‘chargeable assets’ such as houses, stocks and shares, etc. up to a maximum of £275,000 are tax-exempt. Above £275,000 inheritance tax is levied at a flat rate of 40%. Assets transferred more than seven years before the donor's death are exempt from inheritance tax, while assets transferred between three and seven years before death are taxed at lower rates.

Inheritance tax superseded earlier UK arrangements for taxing wealth, including estate duty or death duty and capital transfer tax.

inheritance tax

see WEALTH TAX.

inheritance tax

See estate tax.

References in periodicals archive ?
TONY BLAIR is being urged to "soak the super-rich" with higher death duties to help poor children.
DOWNING Street is considering a plan to make the super-rich pay more in death duties so extra cash can go to children from poorer families.
I AM compelled to comment on yesterday's Record View "Same Old Tory" about the Conservatives' conference/election pledges, especially the one to axe Death Duties on inheritances up to pounds 1million.
An article in August in the French weekly L'Express hinted that the Lagardere horses would be sold to pay death duties on the estate of Lagardere, who was France's most successful breeder before his death in March.
Death duties forced the break-up and sale of the estate in the 1970s after six centuries of continuous family ownership.
The death duties and the cost of maintenance forced the Eighth Earl and Lady Tankerville to move into a house in the village.
The Treasury's own figures show the cost of this move is relatively small yet it reveals something in Gordon Brown's nature that, budget after budget, he chose to increase the income from death duties.
The 16th-century castle has lain derelict since being sold by the Earl of Errol to pay death duties.
He was determined it wouldn't go in death duties and said he felt it was better to give with a warm heart than a cold hand.
In a three-part series, Death Duties, which starts tomorrow, she details how she solves crimes by examining her silent witnesses.
We should abolish the vast exemptions on death duties and tax at a more modest universal rate which rises progressively - and at the same time we should raise income tax thresholds so those earning pounds 12,000 per year should pay no income tax.
Trevor Mostyn will return to the place that was lost to the Mostyn of Talacre family in 1920 due to death duties on Monday.