10. Minnesota
- Estate tax: Yes
- Estate tax exemption level: $3 million
- Estate tax rates: between 13 percent and 16 percent
- Inheritance tax: No
- Inheritance tax rates: N/A
For 2020, the estate tax exemption in Minnesota is $3 million. However, the North Star State wants to include all taxable gifts that are made within 3 years prior to death in the value of the property.
11. Nebraska
- Estate tax: No
- Estate tax exemption level: N/A
- Estate tax rates: N/A
- Inheritance tax: Yes
- Inheritance tax rates: between 1percent and 18 percent
Nebraska’s inheritance tax is straightforward: you’ll pay less if you, as the heir were closer to the decedent. This also applies to the exemption, not only the tax rate, meaning that the exemption will be greater if you were close to the decent. Note that the surviving spouse is exempt from this tax.
Immediate relatives such as grandparents, siblings, parents, and children have to pay a 1 percent tax and this rule is not applied if the inherited property is actually worth less than $40,000.
Distant relatives like nieces, aunts, nephews, and uncles must pay a 13 percent tax. If you’re the cousin of the deceased, this tax will skyrocket: the inheritance tax rate for you will be 18 percent on properties that are worth $10,000 or more
12. New Jersey
- Estate tax: No
- Estate tax exemption level: N/A
- Estate tax rates: N/A
- Inheritance tax: Yes
- Inheritance tax rates: between 11 percent and 16 percent
In New Jersey, if the property you inherited values $500 or more, you’ll have to pay the inheritance tax. However, the state imposes no tax on transfers to parents, children, spouses, grandparents, grandchildren, or step-children.
The first $25,000 of the inherited property is also exempt if the estate goes to a decedent’s sibling or daughter/son-in-law. After that specific amount of money, they have to pay the inheritance tax; and its rates are between 11 percent to 16 percent.
Other heirs must pay a 15 percent tax on the first $700,000 of the property they inherited and, they will add a 1 percent to those 15 percent which eventually translates to a 16 percent tax if the value of the property exceeds $700,000.
