August 27, 2009

 

2009-R-0305

backgrounder: ESTATE AND INHERITANCE TAXES IN CONNECTICUT AND OTHER STATES

 

By: Judith Lohman, Chief Analyst

 

Connecticut’s estate tax has been an issue in the General Assembly since its passage in 2005.  This report provides background on the historical relationship between federal and state estate taxes and the effect of 2001 federal estate tax changes on state estate taxes. It also summarizes the types of estate and inheritance taxes, and the tax rates and taxing thresholds in effect in 2009 in Connecticut and the 21 other states that have such taxes. This report has been updated by OLR Report 2012-R-0309.

 

ESTATE AND INHERITANCE TAXES

 

Two Taxes Explained

 

The estate tax and the inheritance tax are taxes imposed on the value of property a person bequeaths to his heirs.  These types of taxes are referred to as transfer taxes or, because they are imposed when someone dies, as “death” taxes. 

 

The estate tax is imposed on the total value (after deductions and exemptions) of a person’s real and personal property (“estate”) at his or her death.  The executors of the estate are liable for paying an estate tax.  An inheritance tax is a tax on each heir’s right to receive the property transferred to him or her.  Thus, it is calculated separately for each heir and depends on the value of the heir’s inheritance.

 


The federal government imposes an estate tax, as do 17 states.  Seven states have inheritance taxes.  Two states, Maryland and New Jersey, impose both types of tax.  Connecticut had both taxes until 2005, when the state’s inheritance tax, known as the “succession tax,” was repealed. There is no federal inheritance tax.

 

The federal government also imposes “gift tax” on property transfers to beneficiaries during a person’s life.  Under federal law, gifts over a certain size count against the lifetime amount exempted from estate tax upon the person’s death.

 

the evolution of federal and state taxes on inherited wealth

 

Before 2001

 

Taxes on inherited wealth have long been a feature of the U.S. federal tax system. In addition to raising revenue, such taxes are designed to prevent accumulation and concentration of extreme wealth.  After imposing various temporary estate taxes during the 18th and 9th centuries, Congress enacted a permanent federal estate tax in 1916. 

 

State taxes on inherited wealth were likewise common in the 19th century.  Connecticut, for example, first enacted a state inheritance tax in 1889.  By the time Congress adopted the permanent federal tax in 1916, only five states had no state estate or inheritance tax:  Alabama, Florida, Mississippi, New Mexico, and South Carolina.  Three of the five enacted state taxes shortly after 1916: Mississippi (1918), New Mexico (1919), and South Carolina (1922). 

 

In the early 1920s, Florida began a campaign to lure wealthy people to the state by promoting not just its sunny climate but also its low taxes, especially its lack of a state death tax.  Other states became so concerned about the interstate competition that they held three national conferences to devise a method for preserving state estate and inheritance taxes.  The solution they arrived at was to petition Congress for federal relief. In 1924, Congress responded by passing a dollar-for-dollar tax credit against the federal estate tax for state death taxes paid.

 

The federal credit allowed states to share estate tax revenue with the federal government without increasing the net tax burden on estates.  It also served to equalize the impact of estate taxes among states.  All 50 states eventually adopted state estate taxes equal to the federal credit.  Nevada, the last holdout, passed its tax in 1987. 

 

These state estate taxes are referred to as “pick-up” or “sponge” taxes because they are set at the amount of the federal credit for each taxable estate. The federal credit amount depended on the size of the “adjusted taxable estate,” which is the federally taxable estate minus $60,000.  The credit percentage increased as the size of the estate increased.  State pick-up estate tax rates, thresholds, and deductions were typically linked to the federal estate tax law, incorporating the federal provisions by reference.  

 

In 2001, pick-up estate taxes were the only state death taxes levied in 38 states. Several states also had separate inheritance taxes not linked to the federal tax.  State inheritance taxes commonly impose a tax on estates according to both their value and the relationship of the heirs to the deceased person. 

 

2001 Federal Changes

 

Under the federal estate tax law in effect at the beginning of 2001, the threshold for a taxable estate was $675,000 and the top tax rate for the largest estates (over $17,184,000) was 55%.  There was also a 5% surcharge on estates over $10 million. The taxable estate threshold was scheduled to rise to $700,000 for 2002 and 2003, $850,000 for 2004 and 2005, and $1 million for 2006 through 2009. These estate tax thresholds also applied to the state pick-up taxes linked to the federal law.

 

During 2001, Congress passed the Economic Growth and Tax Relief Recovery Act of 2001 (EGTRRA - P.L. 107-134). EGTRRA made major changes in the federal estate tax, including its relationship to state estate taxes. It took effect for deaths on and after January 1, 2002.

 

The EGTRRA phased out the federal estate tax over the seven years from 2002 through 2009 by gradually (1) reducing the top federal tax rate to 45% and (2) raising the threshold for taxable estates to $3.5 million.  It eliminates the federal estate tax entirely for deaths occurring on or after January 1, 2010, but only for one year.  The federal tax “snaps back” to a top rate of 55% and a $1 million taxable estate threshold for deaths on or after January 1, 2011.  The law also eliminated state pick-up taxes by repealing the federal credit over three years and replacing it with a federal tax deduction as of January 1, 2005. Thus, unless a state took action to “decouple” its tax from the federal law, the EGTRRA automatically eliminated state pick-up taxes on that date.

 

Tables 1 and 2 below show the EGTRRA’s annual effect from 2001 through 2011 on hypothetical estates of $3 million and $10 million, respectively, in pick-up tax states not decoupled from the federal law.

 

TABLE 1: ESTATE TAXES PAYABLE ON $3 MILLION ESTATES

IN PICK-UP TAX STATES

 

Year of Death

Total Estate Taxes

State Share

Federal Share

2001

$1,070,250

$182,000

$888,250

2002

930,000

136,000

793,500

2003

925,000

91,000

834,000

2004

704,500

45,000

659,500

2005

695,000

0

695,500

2006

460,000

0

460,000

2007

450,000

0

450,000

2008

450,000

0

450,000

2009

0

0

0

2010

0

0

0

2011

945,000

182,000

763,000

 

TABLE 2: ESTATE TAXES PAYABLE ON $10 MILLION ESTATES

IN PICK-UP TAX STATES

 

Year of Death

Total Estate Taxes

State Share

Federal Share

2001

$4,920,250

$1,067,600

$3,852,650

2002

4,430,000

800,700

3,629,300

2003

4,355,000

533,800

3,821,200

2004

4,065,000

266,900

3,798,100

2005

3,985,000

0

3,985,000

2006

3,680,000

0

3,680,000

2007

3,600,000

0

3,600,000

2008

3,600,000

0

3,600,000

2009

2,925,000

0

2,925,000

2010

0

0

0

2011

4,795,000

1,067,600

3,727,400

 

Source:  Cooper, Ivimey, and Vincenti, “State Estate Taxes after EGTRRA: A Long Day’s Journey into Night,” 17 Quinn. Prob. Law Jour. 317 (2004).  The above examples calculate the federal estate tax assuming that 100% of the unified state credit is available.

 

State Responses to the 2001 Federal Law

 

State responses to the EGTRRA varied. Some states had already decoupled their state estate taxes from the federal law before 2001 and were thus unaffected by the EGTRRA.  Other states allowed their pick-up estate taxes to expire but retained their stand-alone inheritance taxes.  Several states preserved their pre-EGTRRA pick-up taxes by linking them to the federal credit in effect on a date immediately before the start of the EGTRRA phase-out, such as December 31, 2001.  Many states simply allowed their pick-up estate taxes to phase-out according to the EGTRRA credit phase-out schedule, leaving them with no state-level death tax.

 

Thus, in 2009, the number of states with state-level death taxes has dropped from 50 to 22.  The number will fall to 20 in 2010, when estate taxes in Kansas and Oklahoma are scheduled to expire. 

 

Connecticut’s Response to the 2001 Federal Law

 

 When the EGTRRA was enacted, Connecticut had both a pick-up estate tax and a separate inheritance tax called the succession tax. On January 1, 2001, Connecticut was in the midst of a succession tax phase-out and had already eliminated that tax on estates passing to surviving spouses (Class AA heirs) and lineal parents and descendents such as grandparents, parents, children, and grandchildren (Class A heirs).

 

Connecticut absorbed the initial EGTRRA-imposed reduction in its pick-up tax, but in 2003, the General Assembly enacted a temporary estate tax payable in lieu of the pick-up tax. The temporary tax was 130% of the pre-EGTRRA federal credit. It applied to estates over $1 million and to deaths occurring between July 1 and December 31, 2004.

 

In 2005, Connecticut enacted a new estate tax, replacing its former pick-up estate tax, the temporary estate tax, and the Connecticut succession tax. Because of the phase-out, for deaths occurring during 2004, the succession tax applied only to estates exceeding $600,000 passing to collateral relatives, such as siblings, nieces, and nephews (Class B heirs) and estates exceeding $200,000 passing to more remote relatives and unrelated people (Class C heirs).  The 2005 law also eliminated the state gift tax on federally taxable gifts over $25,000.  The state was already phasing out the state gift tax on gifts under $1 million. (See OLR Report 2005-R-0535 for a fuller description of Connecticut’s estate, succession, and gift taxes before and after January 1, 2005.)

 

2009 state estate taxes

 

Seventeen states have state estate taxes in 2009.  The majority are former pick-up taxes that have been decoupled from the federal law.  Eleven states continue to use the pre-EGTRRA federal credit rates, definitions, and deductions.  The other six, including Connecticut, have stand-alone estate taxes, though Connecticut’s is still closely tied to the federal estate tax law and the pre-EGTRRA credit rates.

 

Estate Tax Thresholds

 

As with the federal estate tax, states impose their estate taxes only on estates that meet or exceed specific taxable thresholds, exempting smaller estates. In the 17 states that have state estate taxes, tax thresholds range from a low of $338,333 in Ohio to a high of $3.5 million (the same as the 2009 federal tax threshold) in North Carolina.  The most common state estate tax threshold is $1 million.  Connecticut’s threshold is $2 million.

 

Table 3 shows state estate tax thresholds in effect for 2009 in the 17 states that have estate taxes. 

 

TABLE 3: 2009 STATE ESTATE TAX THRESHOLDS

 

State

Taxable Estate Threshold

Connecticut

$2,000,000

Illinois

2,000,000

Kansas

1,000,000

Maine

1,000,000

Maryland

1,000,000

Massachusetts

1,000,000

Minnesota

1,000,000

New Jersey

675,000

New York

1,000,000

North Carolina

3,500,000

Ohio

338,333

Oklahoma

3,000,000

Oregon

1,000,000

Rhode Island

675,000

Tennessee

1,000,000

Vermont

1,000,000

Washington

2,000,000

 

Tax Rates Linked to the Pre-EGTRRA Federal Credit

 

In 2009, 11 states have state estate tax rates identical to the federal state estate tax credit rates in effect on December 31, 2001 (Internal Revenue Code § 2011 (b) (1)).  These states are Illinois, Maine, Maryland, Massachusetts, Minnesota, New Jersey, New York, North Carolina, Oregon, Rhode Island, and Vermont.  Table 4 shows the estate tax rates and brackets applicable in these 11 states.


TABLE 4: ESTATE TAX RATES AND BRACKETS IN 11 STATES

 

TAXABLE ESTATE

TAX RATE

Col. A:

Over

Col. B:

But

not over

Col. C:

Tax on

Col. A

 

Col. D:

Tax Rate on

excess over

Col. A

0

$40,000

0

$40,000

90,000

0

0.8%

90,000

140,000

$400

1.6%

140,000

240,000

1,200

2.4%

240,000

440,000

3,600

3.2%

440,000

640,000

10,000

4.0%

640,000

840,000

18,000

4.8%

840,000

1,040,000

27,600

5.6%

1,040,000

1,540,000

38,800

6.4%

1,540,000

2,040,000

70,800

7.2%

2,040,000

2,540,000

106,800

8.0%

2,540,000

3,040,000

146,800

8.8%

3,040,000

3,540,000

190,800

9.6%

3,540,000

4,040,000

238,800

10.4%

4,040,000

5,040,000

290,800

11.2%

5,040,000

6,040,000

402,800

12.0%

6,040,000

7,040,000

522,800

12.8%

7,040,000

8,040,000

650,800

13.6%

8,040,000

9,040,000

786,800

14.4%

9,040,000

10,040,000

930,800

15.2%

Over $10,040,000

$1,082,800 plus 16.0%

of the excess over $10,100,000

 

Tax Rates Not Linked to the Federal Credit

 

Six states have estate taxes whose rates differ from the pre-EGTRRA federal credit rates and brackets. The number of estate tax brackets in these states ranges from two to 13 with maximum rates on the largest estates ranging from 3% in Kansas to 19% in Washington.

 

Connecticut. Connecticut’s tax rates are similar, but not identical, to the pre-2001 federal estate tax credit rates.  The main difference is that Connecticut’s lowest rate of 5.085% applies to the entire first $2 million of any taxable estate rather than only to the excess over that threshold.  Connecticut’s estate tax brackets also vary slightly from the federal credit brackets (see Table 5).

 

TABLE 5: CONNECTICUT ESTATE TAX

 

TAXABLE ESTATE

TAX RATE

Col. A:

Over

Col. B:

But not over

Col. C:

Tax on

Col. A

Col. D:

Tax Rate

on excess

over Col. A

0

$2,000,000

No Tax

$2,000,000

2,100,000

5.085% of the excess over 0

2,100,000

2,600,000

$106,800

8.0%

2,600,000

3,100,000

146,800

8.8%

3,100,000

3,600,000

190,800

9.6%

3,600,000

4,100,000

238,800

10.4%

4,100,000

5,100,000

290,800

11.2%

5,100,000

6,100,000

402,800

12.0%

6,100,000

7,100,000

522,800

12.8%

7,100,000

8,100,000

650,800

13.6%

8,100,000

9,100,000

786,800

14.4%

9,100,000

10,100,000

930,800

15.2%

Over $10,100,000

$1,082,800 plus 16%

of the excess over $10,100,000

 

Kansas. Kansas enacted a new estate tax effective for deaths on or after January 1, 2007 but immediately began to phase the tax out.  Under current law, the tax will be eliminated on January 1, 2010.  Table 6 shows the state’s tax rates for 2009.

 

TABLE 6: KANSAS ESTATE TAX FOR 2009

 

TAXABLE ESTATE

TAX RATE

Col. A:

Over

Col. B:

But not over

Col. C:

Tax on

Col. A

Col. D:

Tax Rate

on excess

over Col. A

0

$1,000,000

No Tax

1,000,000

2,000,000

0

0.5%

2,000,000

5,000,000

$5,000

1.0%

5,000,000

10,000,000

35,000

2.0%

Over $10,000,000

$135,000 plus 3.0%

of the excess over $10,000,000

 

Ohio. Ohio’s estate tax rates are shown in Table 7.  The rates include a state estate tax credit of up to $13,900 that effectively exempts estates under $338,333 from the tax.  The rates apply to deaths occurring on or after January 1, 2002.


 

TABLE 7:  OHIO ESTATE TAX

 

TAXABLE ESTATE

TAX RATE

Col. A:

Over

Col. B:

But not over

Col. C:

Tax on

Col. A

Col. D:

Tax Rate

on excess

over Col. A

0

$338,333

No Tax

$338,333

500,000

13,900

6.0%

Over $500,000

$23,600 plus 7.0%

of the excess over $500,000

 

Oklahoma. Like Kansas, Oklahoma’s estate tax is scheduled to be eliminated for deaths on or after January 1, 2010.  The rates below therefore apply only to deaths occurring in 2009 (Table 8). 

 

TABLE 8:  OKLAHOMA ESTATE TAX, 2009

 

TAXABLE ESTATE

TAX RATE

Col. A:

Over

Col. B:

But not over

Col. C:

Tax on

Col. A

Col. D:

Tax Rate

on excess

over Col. A

0

$3,000,000

No Tax

3,000,000

3,010,000

0

0.5%

3,010,000

3,020,000

$50

1.0%

3,020,000

3,040,000

150

1.5%

3,040,000

3,060,000

450

2.0%

3,060,000

3,100,000

850

2.5%

3,100,000

3,250,000

1,850

3.0%

3,250,000

3,500,000

6,350

6.5%

3,500,000

3,750,000

22,600

7.0%

3,750,000

4,000,000

40,100

7.5%

4,000,000

6,000,000

58,850

8.0%

6,000,000

8,000,000

218,850

8.5%

8,000,000

13,000,000

388,950

9.0%

Over $13,000,000

$838,500 plus 10.0%

of the excess over $13,000,000

 


Tennessee. Tennessee’s tax rates are shown in Table 9. 

 

TABLE 9:  TENNESSEE ESTATE TAX

 

TAXABLE ESTATE

TAX RATE

Col. A:

Over

Col. B:

But not over

Col. C:

Tax on

Col. A

Col. D:

Tax Rate

on excess

over Col. A

0

$1,000,000

No Tax

$1,000,000

1,040,000

0

5.5%

1,040,000

1,240,000

2,200

6.5%

1,240,000

1,440,000

15,200

7.5%

Over $1,440,000

$30,200 plus 9.5%

of the excess over $1,440,000

 

Washington. Washington’s estate tax rates are shown in Table 10. 

 

TABLE 10:  WASHINGTON ESTATE TAX

 

TAXABLE ESTATE

TAX RATE

Col. A:

Over

Col. B:

But not over

Col. C:

Tax on

Col. A

Col. D:

Tax Rate

on excess

over Col. A

0

$2,000,000

No Tax

2,000,000

3,000,000

0

10%

3,000,000

4,000,000

$100,000

14%

4,000,000

5,000,000

240,000

15%

5,000,000

6,000,000

390,000

16%

6,000,000

8,000,000

550,000

17%

8,000,000

9,000,000

890,000

18%

9,000,000

11,000,000

1,070,000

18.5%

Over $11,000,000

$1,440,000 plus 19%

of the excess over $11,000,000

 

2009 STATE INHERITANCE TAXES

 

Seven states have inheritance taxes based on the relationship of a deceased person to his heirs.  They divide heirs into from three to five classes and impose different tax rates on each class.

 


Indiana

 

Indiana’s tax has three classes of taxable heirs. Estates passing to surviving spouses are not taxed. Class A covers relatives in a direct line, such as children, parents and grandchildren; Class B covers collateral relatives, such as siblings, nieces and nephews, and in-laws; and Class C includes more remote relatives and nonrelatives.  The amount of the inheritance exempted from the tax is: $100,000 for each Class A heir, $500 for each Class B heir, and $100 for each Class C heir.

 

TABLE 11: INDIANA INHERITANCE TAX

 

TAXABLE ESTATE (exceeding applicable exclusion)

TAX RATES

CLASS A

CLASS B

CLASS C

Col. A:

Over

Col. B:

But not over

Col. C:

Tax on

Col. A

Col. D:

Tax Rate

on excess

over Col. A

Col. E:

Tax on

Col. A

Col. F:

Tax Rate

on excess

over Col. A

Col. G:

Tax on

Col. A

Col. H:

Tax Rate

on excess

over Col. A

$0

$25,000

$0

1%

$0

7%

$0

10%

25,000

50,000

250

2%

1,750

7%

2,500

10%

50,000

100,000

750

3%

3,500

7%

5,000

10%

100,000

200,000

2,250

3%

7,000

10%

10,000

15%

200,000

300,000

5,250

4%

17,000

10%

25,000

15%

300,000

500,000

9,250

5%

27,000

10%

40,000

15%

500,000

700,000

19,250

6%

47,000

12%

70,000

15%

700,000

1,000,000

31,250

7%

71,000

12%

100,000

15%

1,000,000

1,500,000

52,250

8%

107,000

15%

145,000

20%

Over $1,500,000

92,250

9%

182,000

15%

245,000

20%

 

Iowa

 

Iowa has five classes of heirs. Class 1, which is exempt from the tax, includes surviving spouses and relatives in a direct line, such as children, parents and grandchildren; Class 2 covers siblings and sons- and daughters-in-law; Class 3 includes more remote relatives and nonrelatives.  The tax rates on Class 2 and 3 heirs are shown in Table 12.

 

The remaining classes are taxed at flat rates. Class 4 covers transfers (1) to institutions organized in other states; (2) for charitable, educational, or religious purposes; or (3) to Iowa resident trustees for use outside the state.  The tax rate for Class 4 heirs is 10% of the amount transferred excluding any amounts that qualify for a charitable exemption. Class 5 covers transfers to for-profit firms, corporations, and societies.  The tax rate for Class 5 heirs is 15%.


 

TABLE 12: IOWA INHERITANCE TAX, CLASSES 2 & 3

 

TAXABLE ESTATE

TAX RATE

CLASS 2

CLASS 3

Col. A:

Over

Col. B:

But not over

Col. C:

Tax on

Col. A

Col. D:

Tax Rate

on excess

over Col. A

Col. E:

Tax on

Col. A

Col. F:

Tax Rate

on excess

over Col. A

$0

$5,000

$0

5%

$0

10%

5,000

12,500

250

5%

500

10%

12,500

25,000

625

6%

1,250

10%

25,000

50,000

1,375

7%

2,500

10%

50,000

75,000

3,125

7%

5,000

12%

75,000

100,000

4,875

8%

8,00

12%

100,000

150,000

6,875

9%

11,000

15%

Over $150,000

11,375

10%

18,500

15%

 

Kentucky

 

Kentucky has three classes of heirs.

 

 

 


 

TABLE 13: KENTUCKY INHERITANCE TAX, CLASSES B & C

 

TAXABLE ESTATE

TAX RATE

CLASS B

CLASS C

Col. A:

Over

Col. B:

But not over

Col. C:

Tax on

Col. A

Col. D:

Tax Rate

on excess

over Col. A

Col. E:

Tax on

Col. A

Col. F:

Tax Rate

on excess

over Col. A

$0

$500

$0

4%

$0

6%

500

1,000

0

4%

0

6%

1,000

5,000

0

4%

30

6%

5,000

10,000

160

4%

270

6%

10,000

20,000

360

5%

570

8%

20,000

30,000

860

6%

1,370

10%

30,000

40,000

1,460

8%

2,370

12%

40,000

50,000

2,660

10%

4,170

14%

50,000

60,000

3,160

10%

4,870

14%

60,000

100,000

4,160

12%

6,270

16%

100,000

200,000

8,960

14%

12,670

16%

200,000

500,000

22,960

16%

28,670

16%

$500,000 and over

70,960

16%

76,670

16%

 

Maryland

 

Maryland’s inheritance tax imposes a flat 10% on the value of estates passing to covered beneficiaries.  Estates passing to any of the following are exempt: (1) children and other lineal descendants, (2) surviving spouses, (3) parents and grandparents, and (4) siblings.

 

Maryland also has a decoupled estate tax on estates over $1 million (see Tables 3 and 4 above).

 

Nebraska

 

Nebraska’s inheritance tax is imposed by state law, but is administered by counties. It has three classes of heirs.

 

 

 

 

TABLE 14: NEBRASKA INHERITANCE TAX

 

TAXABLE ESTATE (exceeding applicable exemption)

TAX RATES

CLASS 1

(excluding surviving spouse)

CLASS 2

CLASS 3

Col. A:

Over

Col. B:

But not over

Col. C:

Tax on

Col. A

Col. D:

Tax Rate

on excess

over Col. A

Col. E:

Tax on

Col. A

Col. F:

Tax Rate

on excess

over Col. A

Col. G:

Tax on

Col. A

Col. H:

Tax Rate

on excess

over Col. A

$10,000

$15,000

$0

0%

$0

0%

$0

18%

15,000

40,000

0

0%

0

13%

900

18%

$40,000 and over

0

1%

3,2500

13%

5,400

18%

 

New Jersey

 

New Jersey’s inheritance tax has four classes as follows.  The first $500 of an estate passing to Class C or D heirs is exempt. (New Jersey has no Class B.)

 

 

 

 

 

New Jersey also has a decoupled estate tax on estates over $675,000 (see Tables 3 and 4 above).


 

TABLE 15: NEW JERSEY INHERITANCE TAX

 

TAXABLE ESTATE

TAX RATE

CLASS C

CLASS D

Col. A:

Over

Col. B:

But not over

Col. C:

Tax on

Col. A

Col. D:

Tax Rate

on excess

over Col. A

Col. E:

Tax on

Col. A

Col. F:

Tax Rate

on excess

over Col. A

$0

$500

$0

0

$0

0

500

25,000

0

0

0

15%

25,000

700,000

0

11%

101,250

15%

700,000

1,100,000

74,250

11%

165,250

16%

1,100,000

1,400,000

118,350

13%

213,250

16%

1,400,000

1,700,000

157,350

14%

261,250

16%

Over $1,700,000

199,350

16%

309,250

16%

 

Pennsylvania

 

Pennsylvania’s inheritance tax classes and tax rates are:

 

 

 

o   Transfer to grandparents, parents, children and their spouses, lineal descendants, and widows and widowers:  4.5%

o   Transfer to sibling: 12%

o   Family exemption for Class A is $3,500

 

 

Sources:

 

1.    Burman, Len and Hoo, Sonya, State-Level Estate and Inheritance Taxes, Tax Policy Center, Urban Institute and Brookings Institute, August 28, 2006.

 

2.    Cooper, Jeffrey A., “Interstate Competition and State Death Taxes: A Modern Crisis in Historical Perspective,” 33 Pepp. L. Rev. 835 (2006).

 

3.    CCH state tax database and Financial Planning Tookit.

 

4.    Connecticut Department of Revenue Services and Connecticut Office of Policy and Management, Estate Tax Study, February 1, 2008.

 

5.    Cooper, Jeffrey A., Ivimey, John R., and Vincenti, Donna D., “State Estate Taxes after EGTRRA: A Long Day’s Journey into Night,” 317 Quinn. Prob. Law Jour. 317 (2004).

 

6.    Legislative Program Review and Investigations Committee, Connecticut’s Tax System. Connecticut General Assembly, January 2006.

 

7.    McNichol, Elizabeth C., State Taxes on Inherited Wealth Remain Common: 24 States Levy and Estate or Inheritance Tax, Center on Budget and Policy Priorities, September 9, 2006.

 

8.    Various states, Tax department websites and estate tax forms and instructions.

 

JL:ts