inheritance tax

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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 called for phasing out the federal estate tax by 2012, but that was reversed and the tax remained in place on estates worth more than $5.49 million (twice that for couples). Changes in 2017 doubled those thresholds for 2018–25.

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 ?
(d) The estimates obtained from the death duties for each specific type of asset are corrected in the light of independent evidence about the total value of those assets.
Death Duties starts tomorrow night at 9.30pm on RTE One.
Death duties forced the break-up and sale of the estate in the 1970s after six centuries of continuous family ownership.
The present Duke of Gloucester was hoping to raise pounds 1 million to pay deferred death duties but the sale has already exceeded pounds 1.3 million despite being less than a third of the way through the 700 lots.
It often happens, therefore, that many in the racing world die with business assets in their estate - excellent tax planning, as this should achieve 100 per cent relief from death duties (inheritance tax), but what of the administration?
DOWNING Street is considering a plan to make the super-rich pay more in death duties so extra cash can go to children from poorer families.
In 1993, he was pursued by the taxman for death duties and sequestrated.
Mr Mitchell and Mr Osborne said they would pay their full share of taxes or death duties.
Trevor Mostyn will return to the place that was lost to the Mostyn of Talacre family in 1920 due to death duties on Monday.
How many have failed when a founder dies and his heirs have had to sell the business to raise money for death duties? How many stately homes have been lost to our national heritage and now lie in ruin because of the short sightedness of envious legislators?
Shadow Chancellor George Osborne said a Tory Government would raise the threshold for inheritance tax to pounds 1m from pounds 300,000, benefiting nine million families and ensuring "only millionaires pay death duties".
While he's at it he can throw in death duties. They were never intended as a money-raising tax.