inheritance tax

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Related to death duty: inheritance tax

inheritance tax,

assessment made on the portion of an estate received by an individual; it differs from an estate tax, which is a tax levied on an entire estate before it is distributed to individuals. The inheritance tax is usually progressive and is determined by the amount of property received by the beneficiary, as well as by his or her relationship to the deceased. Strictly speaking, it is a tax on the right to receive the property; the estate tax can be characterized as a tax on the right to transmit the property. All states impose either an estate tax or an inheritance tax, some states employing both. A related federal levy is the gift tax, designed to prevent people from avoiding inheritance and estate taxes by giving away property before death.

In the United States, the federal government levied inheritance taxes during the Civil War period and again during the Spanish-American War; since 1916, however, a progressive estate tax has been imposed. The U.S. tax law of 1981 greatly reduced estate and gift taxes by raising exemptions (from $175,000 to $600,000) and lowering rates, and a 2001 law calls phase out the federal estate tax by 2012; estate taxes in 40 states that are based on the federal tax credit for state estate taxes would be phased out in 2006.

inheritance tax

1. (in Britain) a tax introduced in 1986 to replace capital transfer tax, consisting of a percentage levied on that part of an inheritance exceeding a specified allowance, and scaled charges on gifts made within seven years of death
2. (in the US) a state tax imposed on an inheritance according to its size and the relationship of the beneficiary to the deceased
References in periodicals archive ?
Death Duty was heavily backed at odds-on and made virtually all the running under O'Connor, justifying his high reputation at Pat Doyle's stable.
A big crowd made their way to Cragmore in anticipation of seeing history being made and they did not have to wait long as O'Connor guided the Doyletrained Death Duty to victory in the opening maiden.
The ten - including Cameron, Shadow Chancellor George Osborne and Foreign Secretary William Hague - would coin it in under party plans to up the death duty threshold from pounds 1million to pounds 2million.
Originally in the form of Lloyd George's Death Duty, and for most of the century since, IHT has been seen as a means of clobbering the rich.
The event was held to promote the feature film script of Death Duty.
Chancellor Gordon Brown could raise an extra pounds 147m a year while cutting death duty for almost nine out of 10 people, according to the Institute for Public Policy Research.
They put the pounds 700,000 home in a children's trust to avoid death duty, claims a Commons standards and privileges committee report.
The accuracy of this figure may be questioned by the Treasury but there is no argument with the fact that in the past six years proceeds from death duty have risen from pounds 2 billion to pounds 3.
For many people paying death duty tax that starts at 40 per cent after your initial exemption is a key issue, but one which must be weighed against the need to maintain income at a certain level as this is also of prime importance,' said Phil Cook, partner and head of the specialist tax division at Clement Keys.
They put the pounds 700,000 home in a children's trust to avoid death duty and continued to claim unaware it was against the rules, a Commons standards and privileges committee found.