Oklahoma Inheritance Tax Laws
Oklahoma does not collect an inheritance tax but if there was an inheritance tax then it would be paid upon the death of a person. The beneficiaries are the ones taxed. There is a federal inheritance tax that is sometimes piggybacked with the state inheritance taxes. In some states the estate taxes operate independent of federal laws so you can possibly pay estate tax on a state level and no federal inheritance tax. In some cases if the asset is left to the spouse or charity then the tax may not be applied. Also the inheritance tax is also levied on other transfers of property made as an incident of death of the owner such as property transfer from an intestate estate or an incident of the death of the owner.
Inheritance tax exemptions and rates may vary depending on who received the property, i.e. the decedent’s spouse may be taxed at a lower rate than would be a friend of the decedent. A number of states are phasing out their inheritance tax systems.
Those that support inheritance tax say that it is not a death tax per say but a tax on a transfer of wealth that was
received upon the death of a person. Those that are against it state that the full estate, not the amount transferred, increases the effective transfer tax rate. It should be less than the value of the estate.
The amount of tax you have to pay on your inheritance depends on your relationship to the deceased. Usually, a 4.5% tax is imposed on any inheritance passed on to family members and the rate increases to 10% or even 20% on inheritances passed on to friends. Transfers of inheritances between siblings are also subject to an inheritance tax of 12%, but 15% is applied to nieces and nephews. In the event of the death of a person under 21 years of age, there is no tax due on any assets that pass to the parents.
Check the estate tax laws and the Federal estate tax laws to make sure your have applied all taxes accordingly.
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This entry was posted on Monday, December 11th, 2006 at 11:28 am and is filed under Inheritance Tax Laws. Tax Laws. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response. or trackback from your own site.