Nebraska’s Exemptions Might Save You
Nebraska doesn’t have an estate tax, either, and it actually has a higher inheritance tax rate than Kentucky, but its inheritance tax exemptions are significantly larger. Overall, this can result in a lower tax bill.
The inheritance tax exemption is $10,000 for non-relatives, $15,000 for distant relatives like aunts, uncles, nieces, nephews, and in-laws, and $40,000 for parents, siblings, children, and grandchildren. Only gifts valued at more than these thresholds are taxed.
Spouses are totally exempt—they can inherit without worrying that the tax man will cometh. That said, all others will pay from 1 percent up to a walloping 18 percent in inheritance tax. Close relatives in the $40,000 exemption category only pay 1 percent, but non-relatives might have to sell their inheritances to pay that 18 percent rate on anything over $10,000.
