inheritance tax

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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Inheritance tax superseded earlier UK arrangements for taxing wealth, including estate duty or death duty and capital transfer tax.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 ?
There is no IHT to pay on gifts between spouses or civil partners, if they reside in the UK permanently, and you can also currently give away GBP 3,000 worth of gifts each tax year, as an 'annual exemption,' and unused annual exemptions can be carried forward for one year.
Certain investments, such as AIM stocks and Enterprise Investment Scheme shares, though considered more risky, can be advantageous, falling out of IHT if held for at least two years.
Its appeal to those planning their legacy is clear - not only can it exempt part of their estate from IHT in just two years, but in addition it doesn't require investors to give away their assets as is the case with some other IHT strategies.
If you are uncertain about how you stand regarding IHT and would like to know more about how to prevent much of your money falling into the hands of Her Majesty's Revenue & Customs, or your Local Authority through Long Term Care fees, book your consultation today.
Moreover, they would also be able to benefit fully from their inheritance at any point in the future without breaching the Gift With Reservation rules and this is the key benefit - immediate relief from IHT without any restrictions on accessibility.
The IHT site has long been an anachronism in an age where the flagship NYTimes.
The nil rate band was increased in the 2008 budget, but thanks to the rapid growth in house prices in past years, an increasing number of estates are hit by IHT, so it is little wonder that exemptions from IHT are commanding a large amount of media attention.
Transfers during lifetime to other individuals are potentially exempt, which means that IHT may become chargeable if the transferor does not survive for seven years from the date of the transfer, but otherwise the transfer will be hilly exempt.
36) According to this statute, the IHT exercises jurisdiction over Iraqi citizens or residents who committed genocide, crimes against humanity, war crimes, or certain violations of Iraqi law between 17 July 1968 and 1 May 2003--the period of Ba'ath rule in Iraq.
The IHT also sentenced Taha Yaseen Ramadan (5) to life, three other defendants (6) to a term of fifteen years imprisonment, and acquitted one defendant (7) of all charges.
Property alone has pushed more than five million people into IHT territory, with their houses valued above the pounds 285,000 threshold at which the 40 per cent tax kicks in.