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What is estate tax?

| Aug 14, 2018 | Estate Litigation

If a loved one passes away in Arkansas, you may wonder if you have to pay taxes on the estate. While there are many states that do charge various estate taxes, Arkansas is not one of them according to USA Today. In fact, you probably will not have to pay any estate taxes at all because federal taxes only kick in when the estate has a very large value, like over $5 million.

Of course, there is always a chance that your loved one may live in another state. In that case, it may be subject to estate taxes based on that state’s laws. There are 14 states and Washington D.C. that charge such taxes. Again, though, the value of the estate will determine if the taxes must be paid. Usually, if the person has a small estate with few assets, there will not be any charges against it.

The states that do charge taxes are mostly located in the northwest and along the west coast. They are generally states that have a higher income bracket among residents. However, there are also some states that charge an inheritance tax. Those states are all over the map with one southern state, Kentucky, being in the mix. You also may have to pay capital gains on anything you inherit. This is paying oncome taxes if you were not otherwise taxed. So, you may not get away without paying any taxes when you receive part of an estate. This information is for education and is not legal advice.

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Gramling Estes Law Firm

OFFICE LOCATION:

Gramling Estes Law Firm
One East Center #140
PO Drawer 3883
Fayetteville, AR 72701

Phone: 479-521-4444
Fax: 479-521-6730

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