Difference Between Death Tax And Inheritance Tax  

The death tax also known as estate tax in the United States is a tax imposed on the transfer of the ‘taxable estate” of a deceased person, whether the property is transferred via a will or according to the state laws. Inheritance tax on the other hand is the tax on the property inherited by the beneficiary of the property.

The primary difference between inheritance tax and estate tax is where the tax burden falls, i.e. whether it must be paid by an individual heir or by the estate itself, and to whom the tax is paid. In the U.S., inheritance tax is levied by the state. The U.S federal government levies the estate tax.

Inheritance tax is a tax on the money and assets received by a beneficiary while the estate tax involves grand total of everything the decedent owned and had interest in at the time of death.

The inheritance tax rate depends primarily on the type of property being inherited and the relationship the heir had with the decedent. The estate tax rate depends on the overall value of the estate. The appraisers usually assess the fair market value of the estate’s assets and interests to evaluate the overall value of the estate.

In some states, state inheritance tax is not applicable if there is no federal tax. But in some states inheritance tax applies whether or not federal estate tax is applicable.

Federal government taxes are payable out of the money left behind in the estate or monies realized from sale of the estate or part of it. State taxes on the other hand are imposed on the individual who inherits the property. It is the responsibility of the beneficiary to file appropriate returns and remit the applicable death tax.

More Articles :




Difference Between Death Tax And Inheritance Tax

Does-Obama-Sign-On-Death-Tax      In the early 20th century, estate tax or death tax was enacted as a levy on wealth and inherited assets. Later it was amended so that a spouse could avoid the levy of tax. Estate tax or death tax strikes heavily at small and medium sized family-owned businesses that generate the majority of American jobs. It is supposed to be an easy way to extract revenue from the likes of Warren Buffet and Bill Gate and the super-rich. More..




Home  • Bankruptcy Law   • Business Law  • Constitution Law • CopyRight Law   • Criminal LawEmployment Law   • Family Law   • Immigration Law   • Legal Dispute      • Malpractice   • Personal Injury   • Real Estate Law   • Tax Law   • Traffic Law   • Trust Law Legal News

Difference Between Death Tax And Inheritance Tax )
Copyright © 2012  Rocketswag.com, All Rights Reserved.