If your loved on recently passed away and you are a beneficiary to their
estate, you probably have a lot of questions. How long is
probate? Will any of the decedent’s assets pass outside of probate? Does
Tennessee still impose an inheritance tax? For the purposes of this post,
we are going to address the last question about Tennessee’s inheritance tax.
According to the
Tennessee Department of Revenue, “Inheritance tax is imposed on the value of the decedent’s
estate that exceeds the exemption amount applicable to the decedent’s
year of death.” The TN Department of Revenue goes on to explain
that the “net estate” refers to the fair market value of all
the assets combined, less any allowable deductions, such as:
- The decedent’s debts
- Administrative expenses
- Property that passes to a surviving spouse
As of December 31, 2015, the inheritance tax was
eliminated in Tennessee. For any decedents who passed away after January 1, 2016,
the inheritance tax no longer applies to their estates. For all other
estates subject to the inheritance tax (for deaths that occurred before
December 31, 2015), the inheritance tax is paid by the executor,
administrator, or trustee and it is paid out of the estate.
Exemption Amount for 2015
The exemption amount for decedents who passed away in 2015 was $5,000,000.
For all deaths that occurred in 2016 and thereafter, no Tennessee inheritance
tax is imposed. If the person passed away in 2015 and value of the decedent’s
gross estate was below the exemption amount for 2015, an inheritance tax
return (INH 301) is not required, but if the estate is probated, it would
need the short form inheritance tax return (INH 302).
If your loved one passed away in 2015 and you have further questions, click
her to read
Tennessee’s Inheritance Tax Guide. If an estate tax return is required for a death occurring in 2015, the
executor is required to file it within nine months of the person’s
death, or they’re expected to file for an extension. If tax was
due, it was supposed to be paid by an original deadline. Otherwise, interest
would accrue on the unpaid balance.
As motioned above, for all deaths occurring after December 31, 2015, no
inheritance tax will be imposed. If you are an executor or a beneficiary
who has questions regarding taxes imposed on Tennessee estates, I can
help. As a Nashville probate attorney, I would be more than glad to answer
your tax-related questions regarding the probated estate.
If you need advice from a skilled probate lawyer,
contact my firm for a free consultation!